EPF withdrawal rules – When and for what you can withdraw from your Employee Provident fund account.

epf withdrawal rules

Employee provident fund or EPF is generally the first organized savings product that one experiences at the start of his employment career. The main purpose behind EPF is to help employees save a fraction of their salary and accumulate tax free corpus to support Retirement.

But there are many instances where you may require money before retirement to pay towards important expenses like for Marriage, education etc. So it’s is important to know the epf withdrawal rules so if this is the only or one of the major savings that you are doing you can plan your finances in a better way.

When gurinder, one of my blog readers mailed me his query on how to partially withdraw money from employee provident fund, i decided to write a complete detailed post on epf withdrawal rates, for the benefit of other readers too. His query was referring to my views on choosing between EPF or NPS.

Before going ahead with epf withdrawal rates, let’s understand some basics on EPF itself.

What is Employee provident fund (EPF)?

It is a compulsory saving tool where 12% of your basic pay (Plus DA or cash value of food allowances) gets deducted every month and deposited in an EPF a/c. Your employer also contributes the same figure, but out of his contribution 8.33% goes to EPS and only 3.67% adds into your EPF a/c.

Though there are some other rules/conditions on the maximum/minimum basic pay on which EPF to be deducted, but I am ignoring those as of now, so you should not get distracted from the core of this article.

This EPF a/c earns annual interest (currently 8.7%) which is declared every year by EPFO (Employee Provident Fund Organization), a statutory body of Indian Government under Labor Ministry, in consultation with Ministry of Finance.

EPF is a long term savings tool which stays with you till retirement.It is compulsory to register with EPFO, for all organizations which have employed more than 20 employees. Thus it is imperative for you too, to know the epf withdrawal rules, so you can plan your finances to manage the expenses towards major life events.

EPF withdrawal rules: At the time of Resignation or Job Change:


EPF withdrawal rules say that it is illegal to withdraw epf while making job switch. You can withdraw epf only when you have no job and 2 months have been passed since your last employment, in other words you should be unemployed for at least 2 months. Though in practice this does not happen as it is not possible for EPFO to track these things and employee also finds convenient to clear off the account while leaving job, as he assumes hassles in claiming back the money later on.

Besides the legal angle behind it, from financial planning perspective also it is not advisable to withdraw your EPF while switching jobs. Tax free interest, compulsory savings, equal employer contribution and annual compounding makes this product very attractive from long term savings point of view.

In fact one should use the transfer facility and transfer the balance lying in one account to the new employer’s account. These days it has become quite easy with the launch of “UAN – Unique Account Number” which is allotted to every employee and will remain same throughout the employment career. Now you will not be given a new account number every time you switch the job. UAN will make transfer and management easy.

As UAN is applicable to current and future jobs only, all old accounts which are there from earlier employers have to transferred separately though online.

here’s a post in Business standard which will guide on “How to withdraw money from Dormant EPF a/cs”

EPF withdrawal rules – during Job tenure:

There are various conditions laid down for premature withdrawal of EPF balance. Individual has to furnish various relevant documents and also satisfies the criteria laid down under epf withdrawal rules to be eligible for the withdrawal. Below are the purposes for which you may withdraw EPF while on Job.

epf withdrawal rules

EPF withdrawal rules, also allows some special situation withdrawals like on early retirement due to permanent and total bodily or mental disablement, in case of individual migrated abroad for taking employment or permanently settling there.

Taxation on EPF withdrawal

EPF withdrawal rules say that any withdrawal after completion of 5 years of continuous service will be tax free in the hands of recipient. But if 5 years has not completed than the full withdrawal amount be taxable and all the tax benefits earned in the last years of contribution will be reversed.

As per new epf rules announced in budget 2015, any taxable withdrawal of epf will be subjected to [email protected]% if Pan is registered or @30% (maximum marginal rate) if Pan is not registered. But in case the withdrawal amount is less than 30000 then no TDS will be deducted. Also person can submit 15g form at the time of withdrawal if his income does not exceed the basic exemption limit after adding the epf withdrawal amount.


EPF withdrawal rules clearly states that even though this is a long term savings tool, it has necessary liquidity features attached. Still it is advisable to have proper plan at place for your different goals, so you can allocate different instruments towards those goals. EPF is meant for retirement savings, so as long as it is possible you should not withdraw out of it, but if emergency strikes and you don’t figure out any other way, option is there.

Do you find the information on EPF withdrawal rules helpful? If you have any query or want to share your experience , please share it in the comments section below.


  1. Dear sir,
    I have gone through new PF deduction rules which states that for tax free PF withdraw, work tenure shall be 5 years minimum. But not mentioned whether it should be on continuous basis and in a same organization.
    As, In my previous organisation I worked for 4 years .. Now i joined new organization but since we are very less in numbers my PF is not getting deducted for last 10 months. but now we are in sufficient numbers and our organization going to deduct my PF.
    So my question is that after completing deduction of PFfor 1 year in my new organization and 4 years of PF deduction in previous organization … means in total 5 year PF deduction .. shall I able to withdraw my PF on a tax free basis?? Please confirm

    • Regular PF deposits in the respective account should be continuous for 5 years to make the withdrawal tax free. and to withdraw PF you have to remain out of job for at least 2 months.
      In your case, since you did not withdraw PF after leaving a job , and now your new employer has started deducting /depositing your PF after 10 months of Gap and that too in the same account, so I believe it should be tax-free, after another 1 year of contribution. Rest it all depends on the rules prevalent at the time of withdrawal.
      Rest, it is always better to transfer the epf to the new employer rather than withdrawing it while leaving the job.

  2. HI, can i withdraw my pf without pan card ? my service is less than 5 year and amount is less than 30,00.
    Please reply m waiting for apply online. and i did all formalities of aadhar and acc no.

  3. Sir,
    I have one query regarding pf withdrawal. I resigned from my organization 18 months back after working there for 2 years.Now I see I have accumulated some interest in pf account in the meantime and has increased to 46k.I wish to withdraw that amount, so please help me understand whether it will be taxable or any other deduction will happen on the amount upon withdrawal, if so then how much I can expect roughly upon withdrawal

    • Firstly, if you are in a job then you will not be able to withdraw the EPF. If you are jobless for at least 2 months then only you are eligible to withdraw the EPF money. and yes, that would be 100% taxable as you have not yet completed 5 continuous years

  4. Dear Sir

    I have worked for a organization for around 20 years and my PF was being deducted since the year 1999. However recently our organisation faced financial crisis and hence no salary or PF has been paid since last two years. I have not resigned yet since my salary and PF is pending with the organization for more than 20 months. However, to cover family needs, without resigning I have joined another organisation and they are also deducting PF and now on the EPFO website there are two separate PF accounts under my UAN. I am not sure if it is legal to have two accounts under the same UAN.

    My current age is 45 years and I have around 4 lakh rs under my previous employment PF account. I do not really want to withdraw it since it is getting good compound interest. I just want to know how should I deal with this, should I withdraw it or should I leave it as it is so that it can continue earning interest.

    You wise advice will be highly appreciated.

    • This is strange since UAN itself is your PF account number and the purpose of UAN is not to have different PF numbers when working with different employers. Still, i would suggest you get the PF amount transferred to the new account. You need not withdraw it. Ask your current company’s HR for the process.

  5. Dear Sir,
    I have Entered Exit Reason In PF Account of some employees As “Retirement”(R) instead of “Cessation” (C) . When theleft employees applying for online PF claim then his/her claim rejected by EPFO. The details mentioned there is “Retirement from service after attaining the age of 55years”. Please suggest how can I rectify this mistake.

  6. I have worked in a MNC ofr 9 Years and 8 months and have been contributing to super annunation fund all these years.

    Now i have resigned from the organisation and joined a new one.

    Now i would like to withdraw the complete fund which is accumulated for the last 9 years.

    Please support me to get clarified on the below queries

    – Can i withdraw 100 % of the superannuation fund
    – If yes, what will be the taxable amount for 9 Lakhs
    – If no, What is the maximum amount i can with draw
    – Can i convert the remaining amount to pensionable income

    Thanks for your support to answer these queries

    • – Can i withdraw 100 % of the superannuation fund
      – If yes, what will be the taxable amount for 9 Lakhs
      – If no, What is the maximum amount i can with draw
      – Can i convert the remaining amount to pensionable income

  7. Greetings ! I have resigned my earlier job after 19 years of service, and have joined my new job after a 3 month break. Can I withdraw my EPF from my earlier company in part / fully, and if so, what would be the tax payable. Also, is it advisable that, instead of withdrawing, i leave it in there and continue with my EPF in the new company (anyways since both of them are tied under the same UAN). Thanks.

    • EPF is a good Retirement savings tool earning tax free interest. It is aways advisable to continue the account till your retirement

  8. I was working for Company A since October 2011, and left it in July 2016 to immediately join Company B. Company B created a new UAN, and was left with two UANs in the process. I tried transferring the earlier PF account of Company A to Company B thru EPFO portal, but the request got rejected and then was somehow able to raise Form 19 and got PF withdrawal of Company A with 10% TDS. My question is, is this withdrawn PF amount taxable since I have been in continuous service for more than 5 years?

    • Since your tenure with company A was not of 5 years, that’s why TDS was deducted. But if you could have transferred EPF of Company A to the new UAN then you could be spared of this TDS. Now as you have already withdrawn the money and this can’t be credited to the new UAN, so you have to bear the burden of taxation, which is not limited to 10% only…Check with your CA and file ITR accordingly


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