So you’ve got that dream opportunity and are jet-setting off to a new country. But as you tie up all the loose ends and sign off on the paperwork, don’t forget your Employees’ Provident Fund (EPF) account. If your employment in India ceases, so will your eligibility to continue contributing to EPF; so you can withdraw the amount and close the account.
According to the EPF Act, in order to claim the final PF settlement, you have to be 58 years of age and retire from your job. The rules also allow you to withdraw money in case of unemployment for more than two months.
The total PF balance you can claim includes your contribution as well as that of your employer, along with the interest accrued. However, if you’re settling abroad, you can apply for withdrawal at any age. In fact, when you are relocating, you can withdraw the money immediately.
To apply for withdrawal, you need to get an EPF withdrawal form from your employer. You can also download it from the EPFO (Employees’ Provident Fund Organisation) portal. If your Universal Account Number (UAN) is linked to your Aadhaar, you can use the Aadhaar-based withdrawal form and approach the EPFO office directly, without the intervention of your former employer. You can also apply for the withdrawal online through UAN’s portal. Fill in the form stating the reason for withdrawal as moving abroad, and submit it along with the necessary documents.
If you are planning to go abroad only temporarily, it makes sense to retain your EPF account. While an EPF account that hasn’t received any contributions for three years is considered inoperative, the amount deposited in it continues to earn interest till you turn 58.
When you live and work in a foreign country, you might be required to contribute to the pension or social security scheme there, even if you are employed with an Indian company. If you have only gone abroad for a short duration and still work for an Indian employer, it might not be beneficial for you to contribute to such a programme because chances are that you will not be able to reap the benefits. The Indian government has social security agreements with several countries, including Australia, Canada and Germany. If you are going to one of these countries, you can apply for a certificate of coverage issued by EPFO, which will exempt you from making contributions to the local social security scheme. But for this to work, you need to be employed in an Indian company and your employer must keep depositing EPF contribution on your behalf, during your foreign stint.
Handle your EPF account depending on your long-term plans, but complete the paperwork on time.