How To Merge Your PF Accounts: Easy Steps To Combine Multiple EPF Accounts
Changing jobs is a part and parcel of professional growth, especially in the private sector. Along with the transition, your EPF account changes too. Each new job brings a new EPF account, but your Universal Account Number (UAN) remains constant. It's crucial to merge your old EPF accounts with the new ones to avoid potential losses and to streamline your savings effectively.
Why Merge PF Accounts ?
When you don't merge your EPF accounts, you miss out on the complete picture of your deposited amounts. Moreover, merging PF accounts is essential for tax-saving purposes. Failure to merge EPF accounts results in separate calculations for each period, leading to complications during withdrawals. TDS implications vary with different employment durations. Remember, there's a five-year observation period for withdrawals; exceeding this attracts taxation, particularly on annual interest exceeding Rs 10,000.
Understanding PF Deductions:
A portion of your monthly salary contributes to the PF fund. Currently, the government offers an annual interest rate of 8.15 per cent on deposited amounts. 12 per cent of your basic pay is deducted, with 8.33 per cent allocated to the EPS (Employee Pension Scheme) and 3.67 per cent to EPF. Withdrawals follow predefined rules, ensuring ease of access when needed.
How to Merge PF Accounts :
Merging your EPF accounts is more than just a procedural formality; it's a smart financial move. By consolidating your accounts, you gain a comprehensive view of your savings and avoid unnecessary tax burdens. Follow the outlined steps to merge your PF accounts seamlessly and ensure a hassle-free financial future.
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