How to Calculate PF Amount at Withdrawal?
PF and EPF is a contribution made by both employees and employers towards retirement savings. This fund is managed by EPFO and earns annual interest. Let me tell you about how to calculate PF amount at withdrawal with an example.
Before getting into the calculations, you should know about the components of PF withdrawal. The components are: your total contribution, employer’s EPF contribution, interest earned.
The employer’s share goes to the Employee Pension Scheme but it is not fully withdrawable after 10 years of service.
It is easy to calculate your PF manually. Let me give you an example:
Assume that your basic salary is ₹20,000/month, employee contribution is ₹2,400/month, employer’s EPF share is ₹734/month
Over the next 5 years, employee share is ₹2,400 × 60 = ₹1,44,000, employer share is ₹734 × 60 = ₹44,040 and finally the interest is ₹42,000 (calculated at 8.25% approximately).
Therefore, total withdrawable PF would be ₹2,30,040
You can withdraw your PF amount by applying for the same on EPFO Member Portal or the UMANG App. Remember, TDS may apply if you withdraw PF before 5 years.