The Employees’ Provident Fund, or EPF, allows one to withdraw money for emergency requirements even before retirement. The reasons enabling early withdrawal are laid out in the rules.
Medical emergency
One of the most important situations in which one might need early withdrawal is for medical emergencies. While such sudden needs can arise any moment, they can withdraw 6 months basic wages + DA or employee share with interest, whichever is less. The same formula applies to the treatment of self or a family member.
Purchase/construction of flat/house
Another common need for which there are provisions of early withdrawal is buying a house or flat, or construction of a house which includes the purchase of a plot of land. The amount that can withdraw from EPF is basic wages and DA for 24 months for the purchase of house/flat or construction. The amount rises to basic wages + DA for 36 months or total of employee and employer share with interest or total cost, whichever is the lowest. Withdrawals can be made even for addition/alteration/refurbishing house but the amount is relatively smaller.
Repaying loans
In some special cases, one can withdraw funds even for repayment of loans. One can take 36 months’ basic wages + DA or total of employee and employer share with interest whichever is lower.
Marriage/education
The marriage of one’s kids and education after the 12th standard are also reasons for which one can take advances from the EPFO. The maximum amount that one can withdraw is 50% of employee share with interest.
For physical disability
Withdrawals are permitted even for purchasing equipment for someone with physical disability. The maximum amount is 6 months basic wages + DA or employee share with interest or cost of equipment whichever is lower.
If the firm is closed
If the firm where one works is closed for more than 15 days, the EPFO allows an employee to withdraw funds. The maximum amount is the full employee share with interest. If closure is for 6 months and without compensation and the employee is unemployed, the full amount can be taken out.
The Employees’ Provident Fund, or EPF, is the earliest social security scheme for workers in India the relevance of which is actually going up. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
