Any one confirm me that after amendment of Rate of interest on PF (8.5 % to 9 %) is there any restriction that claimant will not get rate of interest on PF after 3 years, means I have not withdrawal my PF from my previous company from last four years. Someone has told me that I will not get interest on my PF amount (lying with my previous company) after three years.
Please confirm
From India, Faridabad
7Please confirm
From India, Faridabad
Dear Yogesh Mehta, To my knowledge the above decision will come in to force on 01.04.2011. Prior to that you may apply to tranfer the previous amount to the present. Abbas.P.S
From India, Bangalore
From India, Bangalore
Dear Sir Is there any notification ? That means I will get full rate of interest till 31.03.2011
From India, Faridabad
From India, Faridabad
Dear Yogesh and Shreekanth,
I think that the notification to disallow interest on inoperative pf accounts from the 37th month onwards and its effective date, is yet to come from the EPFO. The decision was conveyed by the medias. As per this information, in the 190th meeting of Central Board of Trustees (EPF) presided over by the Hon'ble Union Minister for Labour and Employmet Shri. Mallikarjuna Kharge on 15.9.2010 has taken the above decision.
TAXGURU, The leading tax consultancy website in India has published its details on 18.09.2010 as under:
"PF accounts idle for 36 months or more months to fetch no interest
Submitted by : admin on dated Saturday, September 18th, 2010
The decision by the Employee Provident Fund Organisation (EPFO) to stop paying interest on accounts that have not been operated for 36 months or more is expected to cover 60 per cent of the accounts. According to EPFO estimates, there were 30.5 million inoperative accounts across 120 offices. In all, the agency had 47.1 million subscribers at the end of March 2009, which is estimated to have increased during the last financial year. However, latest data on the total number of subscribers was not available.
In all, the agency estimated that Rs 15,416 crore was lying in inoperative accounts (see table).
While 85 per cent of the inoperative accounts have a balance of less than Rs 5,000, such accounts having less than Rs 1,000 are 51 per cent. The balance in some of these are as low as Rs 1 or Rs 2, but maintaining these accounts cost around Rs 100. EPFO said over 11 per cent of the inoperative accounts had less than Rs 100.
The low balance in inoperative accounts was the result of subscribers giving up on their jobs, while the ones with more funds may have been the result of members chosing to leave the balance and opting to open a new account while switching jobs.
INOPERATIVE ACCOUNTS
Balance
Rs
Accounts
Million
Amount
Rs cr
1-500
10.55
553.43
500-1,000
5.09
508.73
1,000-5,000
10.30
2657.70
5,000-10,000
2.25
1712.70
10,000-1 lakh
2.16
5542.02
1 lakh-10 lakh
0.13
3550.28
Over 10 lakh
0.02
891.03
Total
30.50
15415.89
Calculations based on EPFO estimates
“As long as someone is in employment, the employer pays a 1.1 per cent fee on the amount deducted. But the moment, the deduction stops, the fee also ends, as it cannot be levied on the employee. So, EPFO ends up spending money to keep the account running,” said an official.
Although one option was to levy an annual maintenance charge of Rs 100 on the inoperative accounts, EPFO has decided against it.
Instead, yesterday, the Central Board of Trustees decided that from April 1, 2011, EPFO will stop paying interest for inoperative accounts from the 37th month.
It was also decided that in case these accounts remain dormant and, if any member claims it, with proper identity, the balance in the account will be paid to the subscriber. Also, in case an establishment defaults in payment of contribution for 36 months, accounts would be made operative on payment of the dues and the interest on it."
Abbas.P.S
From India, Bangalore
I think that the notification to disallow interest on inoperative pf accounts from the 37th month onwards and its effective date, is yet to come from the EPFO. The decision was conveyed by the medias. As per this information, in the 190th meeting of Central Board of Trustees (EPF) presided over by the Hon'ble Union Minister for Labour and Employmet Shri. Mallikarjuna Kharge on 15.9.2010 has taken the above decision.
TAXGURU, The leading tax consultancy website in India has published its details on 18.09.2010 as under:
"PF accounts idle for 36 months or more months to fetch no interest
Submitted by : admin on dated Saturday, September 18th, 2010
The decision by the Employee Provident Fund Organisation (EPFO) to stop paying interest on accounts that have not been operated for 36 months or more is expected to cover 60 per cent of the accounts. According to EPFO estimates, there were 30.5 million inoperative accounts across 120 offices. In all, the agency had 47.1 million subscribers at the end of March 2009, which is estimated to have increased during the last financial year. However, latest data on the total number of subscribers was not available.
In all, the agency estimated that Rs 15,416 crore was lying in inoperative accounts (see table).
While 85 per cent of the inoperative accounts have a balance of less than Rs 5,000, such accounts having less than Rs 1,000 are 51 per cent. The balance in some of these are as low as Rs 1 or Rs 2, but maintaining these accounts cost around Rs 100. EPFO said over 11 per cent of the inoperative accounts had less than Rs 100.
The low balance in inoperative accounts was the result of subscribers giving up on their jobs, while the ones with more funds may have been the result of members chosing to leave the balance and opting to open a new account while switching jobs.
INOPERATIVE ACCOUNTS
Balance
Rs
Accounts
Million
Amount
Rs cr
1-500
10.55
553.43
500-1,000
5.09
508.73
1,000-5,000
10.30
2657.70
5,000-10,000
2.25
1712.70
10,000-1 lakh
2.16
5542.02
1 lakh-10 lakh
0.13
3550.28
Over 10 lakh
0.02
891.03
Total
30.50
15415.89
Calculations based on EPFO estimates
“As long as someone is in employment, the employer pays a 1.1 per cent fee on the amount deducted. But the moment, the deduction stops, the fee also ends, as it cannot be levied on the employee. So, EPFO ends up spending money to keep the account running,” said an official.
Although one option was to levy an annual maintenance charge of Rs 100 on the inoperative accounts, EPFO has decided against it.
Instead, yesterday, the Central Board of Trustees decided that from April 1, 2011, EPFO will stop paying interest for inoperative accounts from the 37th month.
It was also decided that in case these accounts remain dormant and, if any member claims it, with proper identity, the balance in the account will be paid to the subscriber. Also, in case an establishment defaults in payment of contribution for 36 months, accounts would be made operative on payment of the dues and the interest on it."
Abbas.P.S
From India, Bangalore
Dear Abbas, You have been one of the best advisors on PF matters on this forum. Thanks for sharing so much of valuable information. Keep posting Regards M.V.KANNAN
From India, Madras
From India, Madras
Dear Yogesh Ji Mehta,
Please allow me to tell you that the EPFO is not a bank or a financial institutution or a company to keep your earnings as fixed deposit with. Please withdraw your legitimate dues as early as possible and keep them elsewhere where you can earn equal amount of interest. You may also think of investing in gold. Please do remember and also tell your other friends who change job from one employer to another; to get their PF accounts transferred to the new employer and continue only one and the same PF account. Change only job for better prospects, please do not change PF account or open new PF accounts every time you change a job. You may continue the existing PF account despite change of job. This will benefit you in the form of continuity of Pension contribution and length of service despite change of employers.
Thanks and regards,
From India, Pune
Please allow me to tell you that the EPFO is not a bank or a financial institutution or a company to keep your earnings as fixed deposit with. Please withdraw your legitimate dues as early as possible and keep them elsewhere where you can earn equal amount of interest. You may also think of investing in gold. Please do remember and also tell your other friends who change job from one employer to another; to get their PF accounts transferred to the new employer and continue only one and the same PF account. Change only job for better prospects, please do not change PF account or open new PF accounts every time you change a job. You may continue the existing PF account despite change of job. This will benefit you in the form of continuity of Pension contribution and length of service despite change of employers.
Thanks and regards,
From India, Pune
The Notification of inoperative PF Accounts has nothing to do with the rate of interest on deposits.
The text of the Inoperative Accounts Notification is as under:
PF ACCOUNTS IDLE FOR 36 MONTHS OR MORE MONTHS TO FETCH NO INTEREST
The decision by the Employee Provident Fund Organisation (EPFO) to stop paying interest on accounts that have not been operated for 36 months or more is expected to cover 60 per cent of the accounts. According to EPFO estimates, there were 30.5 million inoperative accounts across 120 offices. In all, the agency had 47.1 million subscribers at the end of March 2009, which is estimated to have increased during the last financial year. However, latest data on the total number of subscribers was not available.
In all, the agency estimated that Rs 15,416 crore was lying in inoperative accounts (see table).
While 85 per cent of the inoperative accounts have a balance of less than Rs 5,000, such accounts having less than Rs 1,000 are 51 per cent. The balance in some of these are as low as Rs 1 or Rs 2, but maintaining these accounts cost around Rs 100. EPFO said over 11 per cent of the inoperative accounts had less than Rs 100.
The low balance in inoperative accounts was the result of subscribers giving up on their jobs, while the ones with more funds may have been the result of members choosing to leave the balance and opting to open a new account while switching jobs.
From India, Chandigarh
The text of the Inoperative Accounts Notification is as under:
PF ACCOUNTS IDLE FOR 36 MONTHS OR MORE MONTHS TO FETCH NO INTEREST
The decision by the Employee Provident Fund Organisation (EPFO) to stop paying interest on accounts that have not been operated for 36 months or more is expected to cover 60 per cent of the accounts. According to EPFO estimates, there were 30.5 million inoperative accounts across 120 offices. In all, the agency had 47.1 million subscribers at the end of March 2009, which is estimated to have increased during the last financial year. However, latest data on the total number of subscribers was not available.
In all, the agency estimated that Rs 15,416 crore was lying in inoperative accounts (see table).
While 85 per cent of the inoperative accounts have a balance of less than Rs 5,000, such accounts having less than Rs 1,000 are 51 per cent. The balance in some of these are as low as Rs 1 or Rs 2, but maintaining these accounts cost around Rs 100. EPFO said over 11 per cent of the inoperative accounts had less than Rs 100.
The low balance in inoperative accounts was the result of subscribers giving up on their jobs, while the ones with more funds may have been the result of members choosing to leave the balance and opting to open a new account while switching jobs.
From India, Chandigarh
Dear Surendra M. Bhanot,
In Mr. Yogesh Mehta's second posting, he asked about the Notification on not getting interest for more than 3 years after the PF account got inoperative. I was unable to answer on the Notification from EPFO. However you have posted regarding that notification. Kindly state the Reference and date of the notification.
The relation between interest hike to 9.5% and stoppage of interest on inoperative accounts is that both decisions are taken in the same CBT meeting.
Abbas.P.S
From India, Bangalore
In Mr. Yogesh Mehta's second posting, he asked about the Notification on not getting interest for more than 3 years after the PF account got inoperative. I was unable to answer on the Notification from EPFO. However you have posted regarding that notification. Kindly state the Reference and date of the notification.
The relation between interest hike to 9.5% and stoppage of interest on inoperative accounts is that both decisions are taken in the same CBT meeting.
Abbas.P.S
From India, Bangalore
Dear Sir, Till date, there is no such provision for not paying interest on PF accumulations lying with EPFO. However, the EPFO has decided not to pay interest on amount lying inoperative for more than 3 years wef 1/4/11.
As suggested by my collegues as above, it is always advisable to get transfer the old account into new estt,s account as and when any change of job is made. This will keep continuity in membership /qualifying years of service under EPS 95 Scheme.
From India, Chandigarh
As suggested by my collegues as above, it is always advisable to get transfer the old account into new estt,s account as and when any change of job is made. This will keep continuity in membership /qualifying years of service under EPS 95 Scheme.
From India, Chandigarh
Hi
Employees do not continue the same PF no or withdraw the amount as they have to get it signed by the previous employer and inmost cases the previous employer does not sign so easily on the PF papers. The employee gets frustrated making rounds around the previous company even after leaving it, so he prefers to go for new account leaving the previous PF amount just like that.
From India, Hyderabad
Employees do not continue the same PF no or withdraw the amount as they have to get it signed by the previous employer and inmost cases the previous employer does not sign so easily on the PF papers. The employee gets frustrated making rounds around the previous company even after leaving it, so he prefers to go for new account leaving the previous PF amount just like that.
From India, Hyderabad
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PF Interest Rate List-1952-2015- Consolidated-13 .07.16.pdf