The Provident Fund, which is obligatory for every hand who fulfills the Rs threshold for yearly PF donation, is generally considered a withdrawal- acquainted investment option.
Under Section 80C of the income duty act, a hand gets income- duty impunity on a PF donation of over Rs1.5 lakh in a fiscal time. The Workers Provident Fund Organisation (EPFO) provides other benefits to its members.
Then are 5 PF account benefits
Loan against PF A PF account holder can take a loan against their PF balance and the PF loan interest rate levied is only 1 percent if there's a fiscal exigency. Within 36 months of loan disbursal, the loan has to be repaid.
Free insurance Under EDLI scheme, in case of death during the service period, a PF account holder by dereliction becomes eligible for free insurance up to Rs 7 lakh. Preliminarily, the death cover was Rs 6 lakh. Under the EDLI scheme, the PF account holder need not pay any insurance decoration for the death cover.
Home loan and home loan prepayment One can withdraw up to 90 percent of the PF balance for buying a new home or constructing a home, as per EPF rules. So, a PF account can be used for home loan prepayment and through PF balance, one can buy land as well.
Partial pullout during an exigency Subject to some terms and conditions, in case of medical or fiscal exigency, EPFO allows partial pullout.
Pension provision A PF account holder is eligible for pension after 58 times as well. Still, to come eligible for the pension, there has to be a minimum of 15 times of regular yearly PF donation in one's PF account. The pension benefit comes from the employer's donation as8.33 percent of its donation (out of 12 percent) goes to the EPS account of the PF account holder.
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