Understanding the Rules for Withdrawing from Your Provident Fund

Posted on the 21 January 2023 by Baluamrita

 The provident fund or employee provident fund is the biggest safety net for any salaried Indian. Starting in 1952, it covers both the organized sector and the private sector. Most done for retirement, PF funds can be withdrawn before retirement if needed. This is why it is very important that any salaried person does a regular PF balance check before any financial decision. 

In 2022, the Government of India brought about some changes to the rules regarding withdrawals from provident funds. The change was made keeping in mind the financial situations of many Indians who lost their job during the Coronavirus pandemic. If you want to know more about this change of rule, and other rules regarding PF withdrawal, then this blog is for you.

To start with, always remember the PF or EPF account is not like your bank account which allows you to withdraw money easily. PF funds are meant to be your long-term retirement provision. There are mainly three kinds of withdrawals a PF account holder can do, and they are: 

  • PF Final Settlement

  • PF Partial withdrawal

  • Pension withdrawal benefits

Most of the rules are regarding PF partial withdrawal. And it was this rule that was changed in 2022. Now let’s see what the new rules say about this PF partial withdrawal.


The main reason why the rules were changed was to help unemployed Indians during the pandemic. As per the new rules, if a person is unemployed for more than a month from their last job, they can withdraw as much as 75% of their PF balance or three months of their basic salary along with DA, whichever is the lowest. If the unemployment stretches more than 2 months, he or she can then withdraw the remaining amount as well.

Now, let’s see the other withdrawal that can be made from your PF account. Before any of these withdrawals, don’t forget to do a PF balance check to know how much you can actually get after the withdrawal.

Medical purposes

  • Any PF member can withdraw for this purpose. There is no limit to the service period of the employee.

  • The amount can be six times their salary or the employee’s share of the deposit with interest, whichever is lower. 

  • The money can be taken out for medical treatment for not just account holders but for their spouses, parents, and children.

Home loan repayment

  • 3 years of holding a complete job.

  • The flat/home loan must be in the name of the account holder or held jointly.

  • 90% of the entire PF balance is the most they may withdraw.

Wedding loans

  • 7 years of employment minimum.

  • Can be for own’s marriage, children' or siblings'.

  • They may withdraw a maximum of 50% of their contribution plus interest.

Home Renovation

  • 5 years of employment is the minimum.

  • Can withdraw for both house reconstruction and renovation.

  • The house must be in the name of the account holder, or he or she must be a joint owner.

  • The maximum amount that can be withdrawn is 12 times his or her monthly salary.

Purchase or construction of a property

  • Again 5 years of minimum employment.

  • The property/plot must be in the name of the PF account holder, or he or she must be a joint owner. 

  • In the case of the purchase of a plot, the maximum amount that can be drawn is 24 times the monthly salary of the PF account holder. 

  • In the case of the purchase or construction of a new house, it can be either of the three, whichever is the lowest:

  • 36 times the monthly salary

  • Cost of the property

  • The total of the employee’s contributions along with his or her employer’s contribution with interest.

  • This withdrawal can only be done once in their whole service life. 


  • After the age of 58, the full amount of PF can be withdrawn.

  • Can also withdraw 90% if he or she desires.

So, these are some of the withdrawals allowed from your PF account. You should do so only when you don’t have any other options and don’t forget to regular PF balance check to know how much you have. Now let’s see what taxation slabs are applied when you do PF withdrawal.

If you are making a withdrawal before you are in the job for 5 years, a Tax Deducted at Source (TDS) will be deducted when you withdraw.

  • The rate of TDS is 10% with PAN and 34.608% without PAN.

  • No TDS is deducted if the amount is less than ₹50, 000.

  • No TDS is deducted for withdrawals made after 5 years of service life. 

Hence you should not do PF withdrawal early in your service years. If you are changing jobs, transfer your PF or EPF fund to your new employer. If you are currently unemployed or on a job break, only withdraw if it is the last option. Even without a contribution, you can get interest on the accumulated fund for 3 years, the only catch being that interest is taxable.

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