How to extend your PPF account with or without fresh contributions
Public Provident Fund (PPF) continues to be one of the most preferred tax efficient savings products in India to build a retirement corpus. PPF investments of up to Rs1,50,000 (per financial year) are eligible for tax deduction under Section 80C, and the amount received on maturity is tax-exempted. The interest earned is also tax-free. Thus it is one investment vehicle, which enjoys the EEE (exempt-exempt-exempt) status. Moreover the returns are guaranteed and risk-free. 
 
PPF accounts have a lock-in period of 15 years but many people are unaware that it can be extended (with or without fresh contributions) indefinitely (in five year blocks) at the end of the maturity period. Upon completion of 15 years, the entire amount standing to the credit of an account holder in the PPF account along with the accrued interest can be withdrawn freely (by submitting Form C) and the account can be closed. However, financial planners recommend that you continue renewing your PPF account in blocks of five years for the magic of compounding to continue. There is no limit on the number of times you can extend. 
 
If your retirement is far away, then you can opt to continue the PPF account with fresh contribution so as to continue building your corpus while enjoying tax benefits.
 
It is a better idea to submit Form H and extend the account for five more years since it takes just a minimum credit of Rs500 every year to keep the PPF account active. Although, 40% of your corpus remains locked-in till the end of five years, you always have the option to go for partial withdrawals and still reap the benefit of compounding on the account balance.
 
Here we share details about extending your PPF account on maturity. 
 
After completing 15 years, the account holder has to inform the post office or bank within one year whether he/she plans to continue with deposits or not. In case the account holder fails to inform the post office or bank within the one-year time span, the account holder will have to either withdraw the full balance or extend his/ her PPF account without fresh contributions.
 
Extending PPF account without fresh contributions:
 
In case you decide to retain your PPF account after maturity without making any new contributions, then you do not have to inform the post office or bank by submitting any form. The account balance will continue earning interests until the day you close it. 
 
Partial withdrawals: You are allowed to make one withdrawal once every financial year. There is no limit on the amount you can withdraw. The remaining balance in the account will continue to earn interest. It should be noted that only one withdrawal is allowed every financial year.
 
Extending PPF account with fresh contributions:
 
The account holder needs to intimate the post office or the bank that they wish to continue their PPF account with fresh contributions by submitting a Form H. In case this Form H is not submitted by the account holder, the PPF account will be treated as irregular and no interest will be paid on the fresh contributions. If the form is not submitted and yet contributions are made then no tax benefit under section 80C (of the Income Tax Act) will be available for the account holder.
 
Partial withdrawals: In case the account holder decides to continue his account with fresh subscriptions, then he/ she can withdraw up to 60% of the account balance at the beginning of each extended period (block of five years) in one or more installments, but only one withdrawal is allowed per year.
 
E.g. Let us assume that your PPF account is ending on 31 March 2021. The balance at that time in your account is let’s say Rs 45 lakhs. Now, you could either opt to continue the account for five more years (i.e. till 31 March 2026) and continue to invest regularly or you can withdraw only Rs 27 lakhs (over those five years, but only one withdrawal is allowed every year) which is 60% of 45 lakhs (which is your account balance as on 31 March 2021 when you are commencing the five year extension). Account holder needs to submit Form C for partial withdrawal. 
  • Like this story? Get our top stories by email.

    User 

    How to Withdraw and Transfer your Provident Fund Money
    Provident fund (PF) or employee provident fund (EPF) is a popular government of India run scheme, which functions as a useful social security net for individuals employed with eligible organizations. Under the scheme, the employees contribute around 12% of their basic pay plus dearness allowance towards the EPF pool on a monthly basis. A corresponding amount is contributed by the employer. The returns are recalibrated by the union government periodically and currently provide a decent 8.65% per annum for FY2018-19. 
     
    Thus, over a period of time, the cumulative contributions result in a corpus that can provide monetary support during the retirement years. While PF is a very sound investment, in times of extreme emergency, however, the amount could be withdrawn, prior to retirement as well, subject to certain conditions. We shall look at the situations under which an employee can withdraw and transfer the EPF.
     
    To facilitate smooth portability of employee EPF records, the EPFO mechanism functions with the help of universal account number (UAN). Allotment of UAN to the employee is mandatory, whereby the UAN would be linked to the employee’s EPF account.
     
    Details about EPF Withdrawal
     
    One has the option to withdraw EPF completely or partially. But any withdrawal of EPF before five years of continuous employment attracts tax. The following are the situations under which EPF can be withdrawn.
     
    • Complete withdrawal of EPF is permitted under the following situations:
     
    a. Upon retirement from employment
     
    b. In the event that an individual remains unemployed for a period of two months or more, withdrawal is subject to attestation by a gazetted officer. 
     
    • Partial withdrawal of EPF is allowed in the following circumstances, subject to stipulated conditions, with self-attestation facility:
     
    a. Marriage: For the purpose of marriage of self, son/daughter and siblings i.e. brother/sister
     
    • Ceiling on withdrawal limit: Upto 50% of the employee’s contribution towards EPF
    • Minimum number of years in service: This facility can be availed in case of at least 7 years in employment
     
    b. Education: Towards funding education for self (i.e. employee) or his/her children post completion of class 10
     
    • Ceiling on withdrawal limit: Upto 50% of the employee’s contribution towards EPF
    • Minimum number of years in service: This facility can be availed in case of at least 7 years in employment
     
    c. Acquisition of land or house property or construction of house property: The capital asset should be owned by either the employee, the employee’s spouse or owned jointly
     
    Eligible withdrawal amount:
     
    • Asset is land – Ceiling limit is up to 24 times the sum of monthly wages and Dearness allowance
    • Asset is house property – Ceiling limit is up to 36 times the sum of monthly wages and Dearness allowance
    • Minimum number of years in service: This facility can be availed in case of at least 5 years in employment
     
    d. Repayment of home loan: Partial EPF withdrawal is subject to fulfilling following conditions
     
    • The said property should be registered in the name of either the employee, the employee’s spouse or in joint name
    • The employee would have to submit relevant documents to the EPFO, validating housing loan availed 
    • The cumulative amount in the employee’s EPF, either singly or along with the spouse, including the interest component should exceed Rs20,000
    • Ceiling on withdrawal limit: Up to 90% of the cumulative contribution of employee and employer towards EPF
    • Minimum number of years in service: This facility can be availed in case of at least 10 years in employment
     
    e. House renovation: The concerned property should be registered in the name of either the employee, the employee’s spouse or in joint name
     
    • Ceiling on withdrawal limit: Up to 12 times the monthly wages earned
    • Minimum number of years in service: This facility can be availed in case of at least 5 years in employment
     
    f. Upon reaching 57 years of age: 
     
    • Ceiling on withdrawal limit: Up to 90% of the available amount, including interest
     
    Withdrawal procedure: The employee can either submit a physical form or submit an online application.
     
    Steps involved in case of submission of physical form:
     
    Aadhaar based: The employee needs to submit the composite claim form (Aadhaar) at the regional EPFO office. This does not need attestation by the employer.
     
    Non-Aadhaar based: The employee needs to submit the composite claim form (non- Aadhaar) at the regional EPFO office, along with employer attestation.
     
    Steps involved for online submission of form
     
    • This is facilitated by withdrawal of EPF online through the EPF website. The following are the prerequisites for smooth EPF withdrawal and elimination of the need for employer attestation:
    • It is mandatory that the UAN is activated with a valid registered mobile number. 
    • UAN needs to be linked to one’s KYC along with one’s bank account.
     
    Broadly the steps include: 
     
    • Logging into the EPFO website using one’s UAN and password. 
    • Following this, one needs to access the Claim section in the Online services tab. 
    • Upon selection of Proceed for online claim, one needs to fill in the claim form. 
    • Under this, the employee would need to select either of the 3 options in I Want to Apply for tab:   full EPF Settlement, EPF Part withdrawal (loan/advance) or pension withdrawal. 
    • In case being ineligible, the options would not be displayed in the drop-down menu
    • Submit the form
     
    Details about EPF Transfer
     
    In case of a job change, it is advisable to transfer the EPF balance to the current employer. The following are the prerequisites for smooth EPF transfer:
     
    • Approval of e-KYC by employer
    • The previous or current employer should have registered authorized signatories in the EPFO
    • The EPF A/c no of previous as well as current employment should be entered in the EPFO portal
    • A single transfer request against the previous member ID would be accepted
    • Broadly the steps comprise
    • Logging into the EPFO website using one’s UAN and password. 
    • Following this, one needs to access the one member – one EPF account (transfer request) in the online services tab. 
    • Verification of current employment details
    • Selection of either previous or current employer for claim form attestation
    • Validate with OTP based approval of UAN
    • Upon receipt of the form via the unified EPFO interface, the employer would digitally approve the EPF transfer request 
    • Print the form 13 i.e. transfer claim form and submit within 10 days to the selected employer
     
    These are the procedures involved and the situations under which, one is permitted to withdraw and transfer the EPF. However, it must be remembered that the EPF is a useful tool to build a sizeable corpus towards one’s retirement years. Further, the corpus is protected and interest as well as accumulated corpus is tax-free, PF should form a core part of your fixed income investments and so withdrawal should be avoided, to the extent possible. 
     
  • Like this story? Get our top stories by email.

    User 

    COMMENTS

    Madhu Jewellery Vetti

    1 year ago

    Dear all I'm really in very bad situation pls give me chance to withdraw my pf money bcoz of my employer didn't exist me in PF portal and they are refusing to provide UAN NUMBER

    PLEASE IF ANYONE KNOW PLEASE SHARE HERE

    Chandragupta Acharya

    1 year ago

    Very useful article. Thanks

    ROHIT SAXENA

    1 year ago

    Its sad that EPFO is openly violating the SC order and no one is bothered to take notice. As per SC order on Aadhar, Aadhar is not mandatory for those who earn more than 15K, but EPFO insist for Aadhar for opening account.

    REPLY

    Mukunda Deka

    In Reply to ROHIT SAXENA 1 year ago

    It is easy to target salaried/ white money earner middle class. They are sand witched by taxes and lots of other new tactics. They have no priviledge card to enjoy any thing on concession. A salaried tax
    Black money earners still amassed huge money ebrry day. They donot make it whole as earnings. They even did not forego the LPG susidy.

    bharat Rajyaguru

    In Reply to Mukunda Deka 1 year ago

    Bharat rajyaguru plz help I am 7 year countinyu pf and this time deseboll to 60 /work EPFO any help????

    Personal Finance   Sponsored Post
    5 Reasons To Invest Your Bonus In A Bajaj Finance Fixed Deposit
    It is that time of the year, when you receive your appraised salary along with bonuses, which could be a compelling reason to go on a spending splurge. While a retail therapy may sound too good to be true, it is always advisable to put your salary to good use. One of the best ways to utilise your bonus and salary is to save up for a short-term goal. 
     
    Stacking your savings in a saving account however, is not the answer. Instead, you can consider a safer investment option like a Bajaj Finance Fixed Deposit – which ensures guaranteed returns. If you’re wondering why you should invest in a Bajaj Finance Fixed Deposit, here’s what you need to know. 
     
    1. Get one of the highest interest rates
     
    The past year is testimony to why you should invest in stable instruments. In terms of yields, FDs gave some of the best 1-year returns at 6.5%, while some equity funds ate into the invested capital, offering negative returns. Bajaj Finance FD, on the other hand, offers interest rates as high as 8.60% for new investors, 8.85% for existing customers and 8.95% for senior citizens. This is applicable when you take at least a 3-year FD with interest payouts at maturity. 
     
    With these lucrative interest rates, you can surely make your savings grow up to 50% more, by investing for up to 5 years.
     
    To understand how this works, see how a bonus of Rs. 25,000 could grow up to 50% more, with a Bajaj Finance Fixed Deposit.
     
     
    2. Guaranteed returns with complete safety
     
    If you’re worried about the safety of your investment, fret not. Your returns are guaranteed, with no effect of market fluctuations. Bajaj Finance Fixed Deposit has the highest credibility ratings of FAAA by CRISIL, and MAAA by ICRA. You can hence, be sure of the safety of your investment. 
     
    3. Forecast your earnings and monitor them with online tools
     
    You can determine the amount of earnings at maturity with the Bajaj Finance FD calculator basis the tenor and investment amount. With this information, you can decide whether you wish to ladder your FDs to ensure liquidity from time to time while still enjoying high returns, or take home a lump sum amount. In addition to this, you can track your investment seamlessly, through an online account. 
     
    4. Customise your investment through payouts 
     
    Bajaj Finance lets you align your investment to your financial goals by offering you two variants – you can either invest for wealth creation by opting to receive the interest on maturity, or choose frequent payouts. If you opt for the latter, you can fix the frequency of payouts to a monthly, quarterly, bi-annual or annual basis.
     
    5. Invest instantly, without any hassle
     
    Upon receiving a bonus, you don’t have to worry about completing tedious procedures to start your investment. While you can visit your nearest Bajaj Finance branch, you also have the option to start investing online, from the comfort of your home or as you commute to work. 
     
    With the promise of returns amounting to 50% of the invested sum and a minimum deposit amount of just Rs. 25,000, there’s no reason to hesitate before investing in a Bajaj Finance FD. 
     
     
  • Like this story? Get our top stories by email.

    User 

    COMMENTS

    evschakravarthy

    11 months ago

    Does money life recomend Bajaj finance FD? Can we invest based on this article?

    REPLY

    sridhar.chandru.subramanian

    In Reply to evschakravarthy 7 months ago

    Do your quick research. Check CRISIL rating ( Bajaj has a good rating). Check for % of interest directly from their website. Value given here are on the higher side. Bajaj reduces ROI a couple of months ago. You can also check Mahindra Finance, PNB housing.

    raj lee

    1 year ago

    what about TDS

    REPLY

    sridhar.chandru.subramanian

    In Reply to raj lee 7 months ago

    Sumitting 15G will take care.

    bharat Rajyaguru

    1 year ago

    I am 7 year countinyu EPFO and this time I am deseboll 60/parson any help EPFO???

    bharat Rajyaguru

    1 year ago

    Plz help

    Ramkaran Dhiman

    1 year ago

    Kya digital signature k bin pf withdrew kiya ja sakata h

    Raj A

    1 year ago

    We cannot believe these rating agencies anymore... they just go wrong everytime when the company is not performing well ...also these rating agencies miserably failed and given false ratings to companies which failed

    Madhu K R V

    1 year ago

    Guaranteed, I don't believe because the credibility of CRISIL & ICRA is doubtful. Sometime back these companies gave same rating to DHFL and see the fate of investors who trusted these rating companies. We can't question them and the you who say its Guaranteed.

    We are listening!

    Solve the equation and enter in the Captcha field.
      Loading...
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email

    BUY NOW

    online financial advisory
    Pathbreakers
    Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
    online financia advisory
    The Scam
    24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
    Moneylife Online Magazine
    Fiercely independent and pro-consumer information on personal finance
    financial magazines online
    Stockletters in 4 Flavours
    Outstanding research that beats mutual funds year after year
    financial magazines in india
    MAS: Complete Online Financial Advisory
    (Includes Moneylife Online Magazine)
    FREE: Your Complete Family Record Book
    Keep all the Personal and Financial Details of You & Your Family. In One Place So That`s Its Easy for Anyone to Find Anytime
    We promise not to share your email id with anyone