Livemint::Deepti Bhaskaran:24 April 2012:921pm
EPF, which is currently offering 8.25% this year, is one of the preferred retirement planning vehicles owing to its favourable tax treatment - it provides a tax deduction at the investment stage and the returns are tax-free in your hands
Employees’ Provident Fund (EPF), which is currently offering 8.25% this year, is one of the preferred retirement planning vehicles owing to its favourable tax treatment—it provides a tax deduction at the investment stage and the returns are tax-free in your hands.
Every year, usually at the beginning of the financial year, your company gives you an EPF slip.
This slip usually indicates your contribution and interest accrued in your EPF account up to the previous year. For example, if you get the slip in say FY13, the entries in the slip will indicate your fund balance up to FY12.
However, you could also face delays of a few years. This slip is important as it tells you how much you have accumulated in your EPF account.
It is important you understand the entries in this slip to ensure you are able to track your account correctly.
What does your account number stand for?
This number is alphanumeric. The first two entries indicate the regional PF office in which your company contributes your money.
For instance, if your company contributes in the regional EPF office at Bandra, Mumbai in Maharashtra, the entry will look like MH/BAN.
The next entry will be in digits. This will be the employer’s code, followed by the employee’s account number.
How to read your account balance
Your account balance will usually have the following entries.
Opening balance: This is the amount you have accumulated till the beginning of a financial year. In the example above, the opening balance will indicate the fund balance at the start of FY12. This amount is further divided into two heads—employee’s contribution (the amount contributed by you plus interest) and employer’s contribution (the amount contributed by the employer plus interest).
Interest: This entry indicates the interest that has been credited to your account for FY12.
Contributions: This shows the payments made by you and your employer in FY12.
Withdrawals: Any partial withdrawals or advances that you may have taken.
Closing balance: This is the sum of all the entries—the opening balance plus interest accrued on the opening balance and on the contributions made in FY12 plus the contributions made in FY12. Advances you may have taken would be deducted from this kitty. This closing balance will become the opening balance for the next financial year; in this case, FY13.
How to track epf balance online
Go to Epfindia.com and click on know your EPF balance. You will need to know the regional EPF office in which your employer holds an account. The link will then ask for your employer’s and your account numbers.
Key in the digits and your mobile number and the link will SMS you the account balance. The SMS will have two figures for your and your employer’s contribution.
