EPFO can provide ATM facility to withdraw funds from next year.
The Central Government is preparing for major changes in the Employees Provident Fund Organization (EPFO). According to sources, according to the draft of EPFO 3.0, now consideration is going on to provide the facility to employees to withdraw PF funds directly from ATM.
It is believed that this facility can be started from June next year, but only a fixed amount can be withdrawn through it. This will mean that the employee will be able to withdraw money for emergencies, but even after retirement, sufficient amount will remain in the account.
At the same time, consideration is also going on to increase the existing 12% contribution by the employee in EPF. Currently the employee contributes 12% of his basic salary, dearness allowance and retaining allowance, of which 8.33% of the salary goes to the pension fund and 3.67% to the EPF.
Change: So that the employee can withdraw money immediately when needed According to sources, EPFO card will be similar to debit card. Using this card, money can be withdrawn from the provident fund account at ATM like bank debit. This will be called EPFO Withdrawal Card. Through EPFO 3.0, the Labor Ministry aims to simplify the Employees Provident Fund.
There was a demand by employee organizations to make the process of PF withdrawal more flexible. The government believes that with EPFO 3.0, a balance can be struck between providing immediate money to the employee in times of need and also providing a secure amount for retirement.
Employees will also be able to increase their contribution in the pension scheme.
- EPFO 1.0: Accounts were maintained manually. Application and withdrawal were done through paper process.EPFO 2.0 : EPFO went digital. Online portal facility. The employee got the Universal Account Number (UAN).
After leaving the job, you will be able to withdraw 75% of your PF money after one month. Under the rules of PF withdrawal, if a member loses his job then he can withdraw 75% of the money from the PF account after 1 month. With this he can fulfill his needs during unemployment. The remaining 25% deposited in PF can be withdrawn two months after leaving the job.
PF withdrawal income tax rules If an employee completes 5 years of service in a company and withdraws PF, then there is no income tax liability on him. The period of 5 years can also be by combining one or more companies. It is not necessary to complete 5 years in the same company. The total period must be at least 5 years.
If the employee withdraws more than Rs 50 thousand from the PF account before completion of 5 years in service, then he will have to pay 10% TDS. Whereas if you do not have PAN card then you will have to pay 30% TDS. However, no TDS is deducted if the employee submits Form 15G/15H.
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Only one company will be able to provide all the insurance cover, unified license can be approved in the current session of Parliament.
The government is planning to amend the insurance laws in the current session of Parliament. According to officials, mainly two changes are proposed. Unified license for insurance companies and increasing the foreign direct investment (FDI) limit in this sector from the current 74% to 100%.
If these changes happen then the reach of insurance in the country will increase. According to research firm Swiss Re Institute, currently insurance penetration in India is only 3.8%. Unified license is a composite license. This will allow a single company to offer life, general and health insurance products.
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