India is a country with a job change rate of around 35% every year. It is a legal requirement that the provident fund account should be transferred after every job change from the previous employer. However, not everyone is aware of how to get the transfer effected. The transfer procedure is actually very user friendly and simple.
A provident fund account is transferred when an employee shifts jobs either inter-city or intra-city. Let's first start with the method of reading a provident fund account number. The PF number is alpha numerical wherein the first two alphabets stand for regional PF office in charge of accounts, the next five digits are employer code and the last five digits represent employee code.
When should the transfer of account take place?
The employee can apply for transfer of his provident fund account as early as date of joining a new job. In case, he has failed to do so, he can apply for transfer anytime.
Advantages of getting an account transferred
1. Withdrawing the amount from PF requires a waiting period of two months before the form can be processed with previous employer and then submitted at the PF office. Transfer of account can be initiated immediately.
2. Any withdrawals from PF account before 5 years are subject to tax payment. Transferring helps us save on the tax liability and also earn huge amount through interest in the long run.
3. An employee is entitled to pension @ 24% on the amount balance in the account when the employee turns 50 years and is eligible for full pension when the employee turns 58 under the Employees Pension Scheme.
Procedure for PF account transfer
1. A set of new forms are given to an employee at the new place of work when he changes an organization. A fresh PF account number is allotted by the new company.
2. Employees Provident Fund Organisation specifies Form 13 as the transfer form. Fill up the form with full and specific details of previous organisation, previous number allotted by PF department, previous employer PF account no. And previously related employees provident fund office details.
3. Hand over the signed Form 13 in triplicate to the present employer/ hr department.
4. The HR department of the new organisation will fill in the details of the current company and obtain a signature from an authorised signatory.
5. HR will submit it to the regional PF office for transfer of funds from the previous account to the current account.
6. In case of inter- city provident fund account transfers, the regional PF office gets in touch with the previous regional PF office to effect the transfer. The entire process generally takes 30 days.
How to obtain Form 13
Form 13 can be obtained from a local form vendor (please check if it is the revised form) or it can also be down loaded from EPFO official site http://epfindia.nic.in/downloads_forms.htm
What can I do if an old account is still pending transfer
The old amount will be intact and earning interest as on date of application. However, an amendment passed specifies that an account older than 3 years will not be subject to interest after the expiry of the three year period. However, the amount along with interest already earned will be available for transfer at any time.
Points to be kept in mind while applying for transfer of account
Purchase or download the appropriate form for transfer of account.
All columns should be filled completely in the application form.
All details furnished in the form should exactly match the details as are available with PF office while opening that account.
All relevant places should be signed by the applicant.
The form should be attested by the former employer. In case it is not possible, any authorised official as mentioned in the form should attest it.
Applicant can also attach a copy of return Form 10 showing e details of leaving service and details of contribution in Form 3A if it has not been sent by the employer earlier.
Common rejection reasons and recitifications thereof
Signature mismatch on the part of employer / member
In case of mismatch of employer's signature in the transfer form, a formal letter from the PF office attesting the signature of concerned authority has to be submitted.
In case of employee' signature mismatch in the form or if the employee has changed his signature, then employer authentication is required to be forwarded to PF office.
Even then, if the PF office is not willing to accept, then a fresh application needs to be submitted with details as required.
Incorrect account number of the member on the form
The PF office will return the form if the PF account number of the member has been written incorrectly by the member. In that case, the corrected form countersigned by the employer needs to be submitted.
Where the number has been submitted wrongly in returns, then the employer has to send an official communication to the office intimating them of this error and requesting them to correct it.
Incorrect address on the form
If the address does not match with the records available at the PF office, then the member has to provide correct details and re- submit the form.
Incorrect bank account number
Bank account details on the form include columns for account number, name of the bank, branch address, MICR code of the bank( MICR code is a nine digit number suffixing the cheque number on the cheque leaf of the bank where the employee has an account). The details should be verified and re submitted with correct details written on the form.
Incorrect date of joining / resignation
Employee will have to correct the date of joining and leaving the Organisation, get it counter signed by the employer and resubmit the form.
In case, employer had erroneously mentioned the joining/ resigning date wrongly in his annual return, then the employer has to send a formal letter to the PF department informing them of the error and requesting them to correct the records.
Change in authorised signatory while the application is in process
In such a situation, the employee will have to fill a fresh form, get it signed by the new authorised signatory and then submit the form at the PF office again for further processing.
Non remittance of amount by the employer
There are two scenarios in this rejection type. One is where the Organisation has failed to remit the amounts deducted from the employees in their PF account which is a statutory offence. Employee can complain against the employer at the PF office to take appropriate action.
The next scenario is that the employee has changed his name and he has not informed the PF office about this change of name through his employer. In that case, the name of the employee on the form would not match the office records. A formal communication informing about the change of name and also a copy of Gazette notification.
Change in the status of employers
In case the previous employer happens to be an exempted establishment having its own PF trust and manage all the money on its own, the current employer will forward the transfer form to the previous employer who will check all details and hand over a cheque in favour of PF office. It is the duty of the current employer to submit the cheque along with request letter to the concerned PF office. There might be certain delays like documents/ cheque lost in transit, change of address by previous employer, change in authorised signatory by previous employer, internal PF office procedural delays and so on.
Digitisation on the drive
Already implemented projects
Online transfer of funds
The Employees Fund Organisation has now introduced digitisation of the entire transfer process. The process to be followed on the part of employer and employee remains the same. The PF office will now send the details of previous employer to the branch where funds have been held and after checking the records, they would transfer funds to the respective branch online. In case of intra-city transfers, the amount would be transferred between accounts online and thus, transfer would be effected. This has obviated the need for physical dispatch of cheques from one place to another. This has been done with a view to reduce processing time in calculation of the amount to be transferred and mishandling of funds enroute can also be prevented. Electronic fund transfer can help timely, accurate and fraud-free processing.
Please check if all the above points have adhered to or one can also consult the Public Relations Officer at every PF office for further help in submission of the form. A constant communication with the PF department needs to be established to speeden the entire transfer process. If the process appears to be getting delayed, then send a letter providing all details with copies of forms submitted to the PF office of the current employer and address it to the the senior most official in that office, mostly it is 'The Regional Provident Fund Commissioner'. Send all correspondences by registered post or speed post.
Electronic Challan cum Return platform
The EPF organisation had also started a new project named as Electronic challan cum return scheme(ECR)in the month of May 2012 wherein the employers have been allowed to submit their provident fund returns online. Earlier, EPFO used to accept physical returns and feed them in the system manually, thus increasing chances of error and updation delays. This new online filing system will overcome the delay in transfers as updated and accurate data will be available on the PF office system on time. This initiative will help decrease the time taken for transferring the accounts as updated details of PF deductions from the earlier organisation can be checked online by the concerned official and transfer effected at the earliest by the PF organisation.
Projects yet to launched
There are two major digitisation drives yet to be launched which can improve the PF transfer process at a world class level.
Online inspection of companies
One is the provision of an online platform aiming to prevent the need for EPFO officers to personally inspect the companies. The companies will have to submit the details as required by EPF Act on the online portal regularly through which the EPFO will trace the defaulting companies. 'Defaulting companies' are those which do not remit the EPF amount along with their contribution at the PF office account. The parameters specified are supposed to be rigid and the companies shall have to come with all details. This drive will further strengthen the entire working of the PF office as action against defaulters is supposed to be immediate. Since the companies would not default in their payments, the time taken for PF transfers will be very less.
Allotment of Central Unique Account Number
Another digitisation drive is the allotment of a central unique account number specific to an individual rather than alloting PF numbers specific to the employer. This will just like a bank account and the employee can easily access his details and transfer process will be simpler.
Remedy under Right to Information Act, 2005
In extreme cases, where the transfer procedure gets delayed indefinitely and no information seems to coming from any quarter, then an employee has the right to access information through application under 'Right to Information Act'. This procedure of application to RTI is as follows
Applicant buys a Rs10/- postal order from a post office and addresses the 'Pay To' as 'Accounts Officer, EPFO,Chennai'.
Draft a RTI letter giving all details, copies of Form 13 submitted, details of correspondences with PF office and despatch the letter through speed post to registered post and inquiring about the status of the transfer case, balance available in the account and so on.
The PF office has to legally reply within 30 days of receipt of the letter specifying status whether transfer has been effected or is still pending with the PF office where previous employer was employed.
In case, the reply is latter, then a fresh RTI has to be initiated for the other branch of PF office where the issue is pending. Believe it or not, one can find the problem resolved very simply and in a hassle free manner.
|Author: Naren kalkani 25 Sep 2012 Member Level: Silver Points : 1|
|Madam I have a query,|
My PF transfer is pending since 2.5 Years from Maharashtra to Gujarat.
Gujarat at Rajkot office asking for annexture –K from Maharashtra at Mubmai office since 6-months.
But till date Mumbai office has not submit same.
What I have to do.