The EPFO may provide an ATM to withdraw funds from next year.
The central government is gearing up for major changes in the Employees’ Provident Fund Organization (EPFO). According to sources, as per the draft of EPFO 3.0, it is currently being considered to allow employees to withdraw PF funds directly from ATMs.
It is believed that this facility can be launched from June next year, but only a fixed amount can be withdrawn through it. This means that the employee will be able to withdraw money in case of emergency, but even after retirement, a sufficient amount will remain in the account.
At the same time, it is also planned to increase the current 12% employee contribution to the EPF. Currently, the employee contributes 12% of his basic salary, dearness allowance and deduction allowance, of which 8.33% of the salary goes to the pension fund and 3.67% to the EPF.
Employees will also be able to increase their contributions to the pension plan
The central government has also prepared a proposal to amend the pension scheme (EPS-95). In this context, employees will also be able to increase the contribution of 8.33% currently applicable. There will be no change in the employer (company) contribution. He will have to pay this amount in proportion to the employee’s salary. The latter may benefit at any time from the possibility of supplementing the amount of the contribution and the pension fund. The portal will be made more interactive to inform the employee. PF EPFO 1.0 installations: Accounts were maintained manually. The request and withdrawal were made by paper. EPFO 2.0: EPFO has gone digital. Online portal installation. The employee has obtained the Universal Account Number (UAN).
After leaving your job, you will be able to withdraw 75% of your PF money after a month. According to the PF withdrawal rules, if a member loses his job, he can withdraw 75% of the money from the PF account after 1 month. Thanks to this, he can support himself during unemployment. The remaining 25% deposited in PF can be withdrawn two months after leaving the job.
Tax rules relating to PF withdrawal If an employee completes 5 years of service in a company and withdraws the PF, then he is not liable to income tax. The 5-year duration can also be obtained by regrouping one or more companies. It is not necessary to complete 5 years in the same company. The total duration must be at least 5 years.
If the employee withdraws more than Rs 50,000 from the PF account before the end of 5 years of service, then he will have to pay 10% TDS. Whereas if you don’t have a PAN card, you will have to pay 30% TDS. However, no TDS is deducted if the employee submits Form 15G/15H.
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A single company will be able to provide all insurance coverage, with a unified license likely to be approved during the current session of Parliament.
The government plans to amend insurance laws during the current parliamentary session. According to officials, two main changes are proposed. Unified license for insurance companies and increase in foreign direct investment (FDI) limit in this sector from the current 74% to 100%.
If these changes occur, the scope of insurance in the country will increase. According to research firm Swiss Re Institute, insurance penetration in India is currently just 3.8%. The unified license is a composite license. This will allow a single company to offer life, property and health insurance products.