EPF Withdrawal: Complete Guide for Indian Employees and Employers
The Employees’ Provident Fund (EPF) is India’s most important retirement savings scheme, covering over 6 crore active members. Managed by the EPFO, it mandates 12% contribution each from employer and employee on basic salary + DA. Understanding withdrawal rules is critical—whether you are an employee changing jobs, an HR manager processing claims, or a business owner ensuring compliance.
EPFO has digitised most processes through the Member e-Sewa portal, enabling online claims that are processed in 3–20 working days. However, KYC mismatches and employer verification delays remain common pain points.
Types of EPF Withdrawals and Eligibility
| Purpose | Form | Service Required | Maximum Amount |
|---|---|---|---|
| Final Settlement | Form 19 | 2 months unemployed | 100% (75% after 1 month) |
| Medical Emergency | Form 31 | No minimum | 6 months basic salary |
| Home Purchase | Form 31 | 5 years | 36 months wages or cost |
| Home Loan Repayment | Form 31 | 3 years | 90% of corpus |
| Marriage/Education | Form 31 | 7 years | 50% of employee share |
| Pension (EPS) | Form 10C | Below 10 years | Withdrawal certificate |
Tax Implications of EPF Withdrawal
Important Tax Rules
- • Tax-free after 5 years: No tax on withdrawal after 5 years of continuous service (including transfers between employers).
- • TDS before 5 years: 10% TDS if PAN provided, 20% without PAN. Amount added to taxable income for the year.
- • Form 15G/15H: Submit to avoid TDS if total income is below taxable limit.
- • Section 80C reversal: If withdrawal is before 5 years, tax deductions claimed under 80C on employee contributions are reversed.
- • Interest on excess contributions: EPF contributions above ₹2.5 lakhs/year earn taxable interest (effective from FY 2021-22).
Key Takeaways
- ✓ Always transfer EPF when changing jobs rather than withdrawing (saves tax and builds retirement corpus)
- ✓ Activate UAN and complete KYC (Aadhaar + PAN + Bank) for seamless online claims
- ✓ Withdrawal before 5 years attracts TDS at 10%—submit Form 15G to avoid if eligible
- ✓ Partial withdrawal for home purchase/loan repayment is tax-free even before 5 years
- ✓ Employers must process claims within 5 days of receiving online claim notification
Frequently Asked Questions
Can I withdraw EPF while still employed?
Yes, partial withdrawal (Form 31) is allowed for specific purposes like medical emergency, home purchase, marriage, and education. Each purpose has service requirements and withdrawal limits.
How long does online EPF withdrawal take?
EPFO targets 3–20 working days for Aadhaar-verified claims. Common delays: KYC mismatch, employer verification pending, or incorrect bank details. Track status at member.epfindia.gov.in.