It is now common to return to a corporate or organized sector job after taking a break in career, pursuing higher education, maternity leave, family responsibilities or trying your hand in business. But the biggest confusion faced by employees during their return to work is regarding their old Employees Provident Fund (EPF) account. Due to non-contribution for many months or years, employees assume that their PF account is closed forever or the hard-earned money deposited in it is stuck. As per the rules of the Employees Provident Fund Organization (EPFO), if you are rejoining the job, it has now become very easy to reactivate your inoperative or inactive PF account and add the old savings to the new account. EPFO has started state-of-the-art facilities like face recognition and online auto-transfer, due to which the hassle of visiting offices has been completely eliminated.
As per EPFO guidelines, a PF account is not declared inoperative merely because contributions have not been received for some time. When an employee retires after the age of 55 years, permanently settles abroad, or there is no financial transaction in the account for 36 months (3 years) without withdrawal, then the account falls into the category of inoperative. If you are below 58 years of age, the government-determined annual interest (currently 8.25%) continues to be added on your old PF balance even after leaving the job or leaving the job. However, if withdrawal or transfer is not made from the account after completion of 58 years of age, interest stops. Therefore, it is important to activate the old balance immediately after joining a new company.
EPFO has made the UAN (Universal Account Number) activation process more secure to prevent fraud and cyber fraud. Now ‘Aadhaar based Face Authentication’ has been made mandatory on UMANG mobile app. If your UAN was never activated before or is blocked due to forgetting the password, you can activate it from home with these steps:
-
Download Apps: Install ‘UMANG App’ and UIDAI’s official ‘Aadhaar FaceRD App’ from Google Play Store or Apple App Store on your smartphone.
-
registration: Register in Umang App with your active mobile number linked to Aadhaar and generate a 4 digit security PIN (MPIN).
-
Service Selection: Search ‘EPFO’ in the app and go to ‘UAN Services Through Face Auth’ menu and click on ‘UAN Activation’ option.
-
Details and face scan: Enter your 12 digit UAN, Aadhaar number and mobile number. After this, the camera will turn on the screen, where scan your face in the light. Biometric verification will be done as soon as the green circle is formed.
-
Successful activation: Once the details are confirmed, your UAN will be activated immediately and the login password will be sent via SMS to your registered number.
As soon as you start work in a new organization, your new employer generates a new Member ID under your existing UAN. Follow these steps to link the old and new accounts:
-
Update KYC: First of all login to the Unified Member Portal of EPFO. Go to the ‘Manage’ section and select ‘KYC’ and ensure that your Aadhaar, PAN card and new bank account are properly verified.
-
Check Date of Exit: Check ‘Service History’ on the portal. If your previous company has not recorded your exit date, then update the exit date yourself with the help of Aadhaar OTP by going to ‘Manage > Mark Exit’.
-
Online Transfer Request (One Member, One EPF): Go to ‘Online Services’ tab and click on ‘One Member – One EPF Account (Transfer Request)’. Enter your previous member ID and select current employer for attestation.
-
Auto-Reactivation: As soon as the transfer claim is processed, the entire funds (EPF and pension service history) of the old closed account are transferred to your new active account and the inoperative status automatically ends and becomes active.
If your career break is going to be a long one or you have started self-employment and do not want to return to the job, you can withdraw the entire amount from your inoperative account if you remain unemployed for more than 2 months (60 days). For this, you can get the full settlement directly in your bank account by filling ‘Claim (Form-19 & 10C)’ on the EPFO portal. Keep in mind that if your total employment is less than 5 years, tax rules may apply on the withdrawal amount, so do not forget to file Form 15G/15H to avoid tax deduction.