Need for transfer
With increasing competition in the job market these days, people are changing jobs more often than they used to. With a job change, a lot of things need to be transferred from the previous to the new organization. One such thing is the Employee’s Provident Fund (EPF/PF). Earlier transferring PF was a tedious task involving a lot of paperwork produced at both the organizations.
Nowadays, as most processes have gone online, the transfer of PF has also become an online process, saving people lots of time and effort. There are two things that can be done with an existing PF account:
- Transfer the account balance to the current employer
- Withdraw the amount with interest after 60 days of unemployment.
As PF is a great option for retirement savings, it is best to transfer the balance to the new employer and keep the funds preserved until and unless it is extremely necessary to withdraw them. Also, if you happen not to withdraw funds from PF before 5 years of service, you will enjoy tax deductions.
Using UAN for PF transfer online
With the introduction of Universal Account Number (UAN) by the Employees Provident Fund Organization (EPFO), the mode of operation of the account has been simplified to a great extent. Both the employee as well as the employer can benefit from the new upgrades. Staying updated with technological advancements and an increasing number of people using it, EPFO has made it very simple for users to operate their PF accounts. All PF account related functions are now online, including PF transfer and withdrawal which earlier used to be a tedious, time-consuming process.
UAN is the umbrella scheme which covers all Member IDs allotted to the employee during his working tenure and links it to a single member account. It comes with a bag full of services like updating PF Passbook, automatically updated UAN card, all transfer details, linking all previous Member IDs, SMS service on monthly contribution, auto-trigger transfer request on employment change, balance inquiry and withdrawal etc.
Pre-requisites for PF transfer online
The PF transfer online can be done by visiting ‘Unified Portal’ after the introduction of UAN. Earlier it used to be under ‘Online Transfer Claim Portal’. In order to do the online transfer, you need the following,
- An active UAN under the UAN portal with a working registered mobile number.
- Bank account, bank IFSC code associated with the UAN account and Aadhar number. Although linking PAN is not necessary.
- Employer approved e-KYC
- Authorized signatories in EPFO digitally registered by the employer (previous or current)
- PF account number of both current and previous employer to be uploaded in the EPF database
- Please make sure that only one transfer request can be processed against the previous Member ID.
- Authenticated personal and professional information in the EPFO account for future references.
How to transfer PF online?
Once the pre-requisites have been taken care of, the online transfer process can be initiated through the following steps,
Step 1: Use your UAN user number and password to login to Unified Portal.
Step 2: At the Online Services tab, Click ‘One Member- One EPF Account (Transfer Request).
Step 3: Verify the PF account details and personal information for the current employment.
Step 4: Click on ‘Get Details’ to see previous employment details.
Step 5: The claim form regarding authorized signatory holding DSC can be attested by either of the employers- previous or current. You are allowed to choose anyone and provide details of member ID.
Step 6: Receive the OTP by clicking ‘Get OTP’ on the registered mobile number at the UAN portal and click Submit.
Step 7: Once the above formalities have been done, the employer can digitally approve the claim request at the Unified Portal. After that, submit the physically signed copy of the online PF transfer claim form to the chosen employer within 10 days.
Why transfer rather than withdraw?
Transferring the PF account comes with a variety of benefits as compared to withdrawal.
- In case you happen to withdraw the funds before 5 years of service, TDS would be applicable. It is advisable to keep the account for at least 5 years and then make withdrawal claims tax-free.
- The EPF account savings come with compound interest. So maintaining the same EPF account will reap higher benefits than opening a new one on job switch.
- An EPF account which is older than 10 years comes with the benefit of a pension. Employees who maintain their account for more than 10 years are eligible for the same after the age of 58 years.