In case of non-transfer of EPF account after changing job, old account continues to earn PF interest (currently 8.5 per cent) but due to the non-contribution in the account the interest earned in the account becomes taxable
Provident Fund (PF) is mainly considered as a retirement-oriented investment option, which is mandatory for an employee. According to the Employees’ Provident Fund Organisation (EPFO) norms, it is better to transfer one’s PF or Employees’ Provident Fund (EPF) account to the new recruiter. However, due to the lack of Universal Account Number or UAN and PF account number and some formalities required for transfer of the EPF account, it has been found that employees don’t transfer their previous EPF account to the new place of work. In that case, according to experts, the old EPF account continues to earn EPF interest rate (currently 8.5 per cent) but due to the non-contribution in the account the interest earned in the EPF account becomes taxable. It also hits the continuity of the PF contribution that may finally dent the pension benefit of the EPF account holder.