- Date : 14/03/2019
- Read: 3 mins
Claiming transfer of PF balance will go automatic from next year, with no effort required from the employee at all
From the next financial year, employees will not have to file a transfer claim with the Employees' Provident Fund Organisation (EPFO) while changing jobs. The EPFO is finalising the option of automating the EPF transfer of all employees at any time during the next year. On a larger scheme of things, EPFO is moving towards becoming a paperless organisation and is in talks with the Centre for Development of Advanced Computing (CDAC) to achieve this goal. Currently, 80% of its activities have migrated to the online platform.
The EPFO clarified that when the new employer includes the Universal Account Number (UAN) of the employee in its monthly EPF return, the EPF contribution and interest thereon will automatically get transferred. Presently, this transfer doesn’t happen automatically, and an employee has to make a claim online to get the transfer done. An EPFO official has highlighted that the UAN of an employee will effectively be like a permanent account number and would remain the same throughout the lifetime of an employee.
Related: How does a lower EPF contribution impact your retirement savings?
How does the UAN work?
The UAN is a Universal Account Number allotted to all subscribers of Provident Fund. It is issued by the EPFO. Unlike the old days, employees are not given a new PF number every time they change the job. A UAN is for life and with a unique member ID linked to the UAN, all the employee needs to do is to provide the new employee with his or her UAN while joining. UAN has simplified PF transfer claims and made it easier to view updated PF account, download UAN card, update KYC information, etc.
What can we do with the EPF balance when we change jobs?
When we change jobs, we have two options. Firstly, we can withdraw the employee contribution along with interest. However, for this, we need to be on a break of at least 60 days. The second and more recommended option is to transfer the balance to the current employer. It is always advisable to transfer PF balance rather than withdrawing it, for tax reasons and retirement benefits.
Related: 6 Things you must do with your EPF to secure your future
How is the EPF balance transferred when an employee changes job?
The employee has to log in to the Unified Portal with his or her UAN and password. The ‘One Member – One EPF Account (Transfer Request)’ has to be selected, which is available under Online Services. You can select the present employer or the previous employer to attest the transfer claim form. This request is validated through OTP. You will then fill the Form 13 and submit it along with the physical copy of the online claim form.
Related: Tax-saving components of your CTC
Why this automation is introduced and what will change?
The EPFO gets approximately 8 lakh transfer requests every year. It is a separate online exercise that employees need to do every time they transfer their job. However, with the change, the employee will not need to file this transfer claim form. The new employer will, instead, inform the EPFO of the transfer, without the need of undertaking any separate formality. By simply inserting the new employee’s UAN in its monthly EPF return, the UAN will automatically pull in all the balance and interest accrued against it during the employee’s tenure with the previous employer. Besides this, are you aware of these services EPFO is offering?
From the next financial year, employees will not have to file a transfer claim with the Employees' Provident Fund Organisation (EPFO) while changing jobs. The EPFO is finalising the option of automating the EPF transfer of all employees at any time during the next year. On a larger scheme of things, EPFO is moving towards becoming a paperless organisation and is in talks with the Centre for Development of Advanced Computing (CDAC) to achieve this goal. Currently, 80% of its activities have migrated to the online platform.
The EPFO clarified that when the new employer includes the Universal Account Number (UAN) of the employee in its monthly EPF return, the EPF contribution and interest thereon will automatically get transferred. Presently, this transfer doesn’t happen automatically, and an employee has to make a claim online to get the transfer done. An EPFO official has highlighted that the UAN of an employee will effectively be like a permanent account number and would remain the same throughout the lifetime of an employee.
Related: How does a lower EPF contribution impact your retirement savings?
How does the UAN work?
The UAN is a Universal Account Number allotted to all subscribers of Provident Fund. It is issued by the EPFO. Unlike the old days, employees are not given a new PF number every time they change the job. A UAN is for life and with a unique member ID linked to the UAN, all the employee needs to do is to provide the new employee with his or her UAN while joining. UAN has simplified PF transfer claims and made it easier to view updated PF account, download UAN card, update KYC information, etc.
What can we do with the EPF balance when we change jobs?
When we change jobs, we have two options. Firstly, we can withdraw the employee contribution along with interest. However, for this, we need to be on a break of at least 60 days. The second and more recommended option is to transfer the balance to the current employer. It is always advisable to transfer PF balance rather than withdrawing it, for tax reasons and retirement benefits.
Related: 6 Things you must do with your EPF to secure your future
How is the EPF balance transferred when an employee changes job?
The employee has to log in to the Unified Portal with his or her UAN and password. The ‘One Member – One EPF Account (Transfer Request)’ has to be selected, which is available under Online Services. You can select the present employer or the previous employer to attest the transfer claim form. This request is validated through OTP. You will then fill the Form 13 and submit it along with the physical copy of the online claim form.
Related: Tax-saving components of your CTC
Why this automation is introduced and what will change?
The EPFO gets approximately 8 lakh transfer requests every year. It is a separate online exercise that employees need to do every time they transfer their job. However, with the change, the employee will not need to file this transfer claim form. The new employer will, instead, inform the EPFO of the transfer, without the need of undertaking any separate formality. By simply inserting the new employee’s UAN in its monthly EPF return, the UAN will automatically pull in all the balance and interest accrued against it during the employee’s tenure with the previous employer. Besides this, are you aware of these services EPFO is offering?
