Changes in PF rule: Employees’ Provident Fund Organization has updated many of its policies during the year which the members will have to follow from the next year or from now on. Employees’ Provident Fund or EPF is an essential part of any corporate employee’s work life, and members have to follow rules to get their provident fund (PF) money on time. Also, if one does not follow the guidelines, his/her PF contribution may be closed which may come as a huge burden. Employees’ Provident Fund Organization or EPFO, a government-backed retirement body, is a scheme that pools a portion of employees’ salary as well as a fixed amount from employer’s contribution to distribute it after retirement.
As mentioned above, this year EPFO has updated many of its schemes. These include PF-Aadhaar linking, maintenance of two PF accounts for certain employees, increase in insurance benefits under the EDLI scheme and Adding Nominee to Employee’s PF accounts among others.
Here is a closer look at all the changes with which your PF account should be updated
PF-Aadhaar Linking: EPFO has made it mandatory to link the Universal Account Number (UAN) of your PF account with Aadhaar with effect from November 30, 2021. The EPFO had earlier said that it would be effective from June this year. If you do not link your UAN with your Aadhaar number then you may have to face many consequences. For one, if you don’t link the accounts, you will stop receiving employer contributions. Unless it links the accounts and the data is approved by the employers and authorities, the employees will face delay in remittance. Also, they will not be able to withdraw PF money from their accounts.
Adding Nominee to PF Account: All EPFO members are required to add a nominee to their PF accounts by December 31 this year, the retirement body has announced. If this is not done, the employees will be deprived of many benefits. “It is important for the subscribers to enroll for the care of their spouse, children and parents and protect them through online PF, pension and insurance,” the EPFO said in a statement. The purpose of filing nominations is to ensure benefits for the dependents. In case of accident with PF account holder.
Two PF accounts for some employees: The Central Board of Direct Taxes (CBDT) had earlier in the year announced a new set of rules, according to which if an individual’s EPF contribution exceeds Rs 2.5 lakh in a given financial year, they will have to pay two separate Will need provident fund (PF) account. This came into effect from September, where both the accounts should have separate taxable and non-taxable contributions. This has been done to ensure streamlined convenience of calculation for the taxpayer. These new sets of rules were classified under the Income Tax (25th Amendment) Rules, 2021.
Increase in Insurance Benefits under EDLI Scheme: EPFO has come out with a policy to increase insurance benefits to help thousands of families of COVID-19 victims during the second wave. Under this, the retirement body increased the maximum assured benefit under the Employees’ Deposit Linked Insurance (EDLI) scheme from Rs 6 lakh to Rs 7 lakh. The Labor Ministry said at the time, “There has been a demand to provide better social security to the workers without any additional cost to the employer.” However, the minimum limit has been left unchanged at Rs 2.5 lakh.
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