Here is a list of 5 secrets about EPF that can help you boost your savings

The EPF is solely maintained by the Employees' Provident Fund Organisation of India (EPFO). Any company with than 20 employees has to register with the EPFO.

Jun 04, 2017 03:06 IST India Infoline News Service

The EPF is solely maintained by the Employees' Provident Fund Organisation of India (EPFO). Any company with than 20 employees has to register with the EPFO.
 
It is a popular tax saving scheme with a multitude of benefits.

1. Highest interest among small saving investments
One of the main reasons why EPF is regarded as a great investment option is because it offers better interest rate as compared to any small savings scheme. It offers a high rate of return with negligible risk.

2. It falls under EEE category
EPF is a tax saving investment scheme. It comes under EEE category which means that it is completely free from tax. Contributions made to this scheme, interest earned from investment as well as amount withdrawn post maturity are exempt from tax.

3. Rise in salary leads to rise in investment benefits
EPFO makes it compulsory for employer and employee to contribute 12% of employee's basic salary in the PF account. While your contribution is eligible for tax deduction under section 80C, your employer's contribution is fully exempt from tax. So as your salary increases with time, the tax exempt contribution of your employer also increases. Moreover, you can request your employer to increase your contribution in order to take full advantage of tax deduction under section 80C. As a result of this, EPF gains an upper hand over other investment options.

4. Withdrawals are tax exempt post 5 years of investment
Even if you fail to stay invested in EPF till retirement, it is advisable to not withdraw any amount for at least 5 years. Any amount withdrawn before 5 years is fully taxable while the same becomes fully exempt if withdrawn after 5 years.

5. Not just a tax saving investment plan but a very good retirement plan
Many people think that investment in EPF is a good way to save tax while getting a good return. Some people often withdraw EPF amount before maturity due to some or the other reason and fail to avail its retirement benefits. If you stay invested in EPF scheme till retirement, you not only get a large sum of money at the time of maturity but also get regular pension.

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