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What is EPFO’s loyalty cum life benefit, the sole condition for accessing substantial benefits?

The Employees Provident Fund Organization (EPFO) initiated the Provident Fund Scheme for employees, witnessing a continual rise in EPF subscribers. Under this scheme, employees receive pension and a lump sum amount post-retirement.

Both the employer and the employee contribute to the Provident Fund (PF), ensuring the employee’s benefit upon retirement. However, numerous EPFO regulations often elude subscribers’ awareness.

One such regulation pertains to the Loyalty-cum-Life Benefit, offering a direct benefit of Rs 50,000 to the employee, contingent upon fulfillment of a condition.

What is the condition for availing the Loyalty-cum-Life benefit?

EPFO advises all PF account holders to consistently contribute to a single EPF account. By adhering to this and maintaining continuous investment for 20 years, one becomes eligible for the Loyalty-cum-Life benefit.

The Central Board of Direct Taxes (CBDT) recommended granting this benefit, particularly to PF account holders contributing continuously for 20 years.

Following the CBDT’s recommendation, EPFO commenced offering this benefit, exclusively to subscribers contributing to a PF account for two decades, along with an additional Rs 50,000 benefit.

Who receives how much benefit?

For employees with a basic salary of Rs 5,000, the benefit amounts to Rs 30,000. Those with basic salaries ranging from Rs 5,001 to Rs 10,000 receive Rs 40,000, while those earning above Rs 10,000 garner a benefit of Rs 50,000.

A prudent approach to accessing the Loyalty-cum-Life benefit involves maintaining the same EPF account across job changes. Although PF account transfers are now automated, informing both former and current employers about the PF account remains advisable.

Experts also advocate against PF withdrawal during employment to avert potential losses in retirement funds and income tax implications, along with the forfeiture of pension benefits and loyalty.


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