EPFO Account Rules: If you take a loan and are unable to repay it, the lender can seize your property and compensate for that loss. But do you know that salaried people also have such property which is legally protected from any such attachment. We are talking about Provident Employees Fund (EPF).
In case of any financial emergency, it cannot be confiscated to pay off the debt. It has legal protection under section 10 of the EPF and MP Act 1952. Therefore it cannot be attached. Attachment of property means that you will not be able to use or sell it. However, it is not only EPF which has got such protection. Deposits under many other schemes also cannot be attached. Let us know about them in detail.
EPFO Employees Provident Fund and Employees Pension Scheme are covered under the above section. Employers and employees contribute 12-12 per cent of basic salary and DA in EPF. It is considered an important component of social security, hence it has been given legal protection. It is worth noting that the facility of EPF is available only to the people working in the organized sector. Your employer also cannot compensate any loss done by you from the PF account.
The amount deposited in the PPF account has legal protection under Section 14A of the PPF Government Savings Bank Act 1873.Every Indian citizen can invest in this. You can invest in PPF from Rs 500 to Rs 1.5 lakh per year. The interest rate on PPF is 8% per annum.
The amount of NPS National Pension Scheme (NPS) has legal protection under Section 6A of the Pension Fund Regulatory Authority of India. It is seen as an important saving scheme for old age.