Everything You Need to Know About GPF Information for 2021-22
As we usher in the new fiscal year, it is critical that employees stay informed about their General Provident Fund (GPF). This scheme is one of several retirement-saving avenues that the government provides to employees. This article aims to provide a comprehensive guide on all GPF information for the year 2021-22.
What is GPF?
The General Provident Fund is a savings scheme set up by the government for its employees. It allows employees to accumulate their savings during their working years. It is a mandatory scheme for government employees, with contributions deducted from their salary every month. The government also matches this contribution, making it a lucrative savings opportunity.
How much can employees contribute to GPF, and what is the interest rate for 2021-22?
The maximum an employee can contribute towards their GPF account is 100% of their basic salary and dearness allowance. For the fiscal year 2021-22, the interest rate for GPF has been set at 7.1%, which is an increase from 7.9% in the previous fiscal year. This move follows the Reserve Bank of India’s stance for low-interest rates amid the pandemic.
Can employees withdraw from their GPF account?
Yes, employees can withdraw from their GPF account. However, partial withdrawals can only be made for specific reasons, such as medical emergencies, higher education, or purchasing or constructing a house. Employees must have completed ten years of service to be eligible for a partial withdrawal. A maximum of three withdrawals is permitted throughout an employee’s entire service period.
What happens to the GPF account after retirement?
The GPF account is payable to the holder on his or her retirement from government service. Alternatively, employees who resign from their job or die in service can claim their accumulated GPF balance. However, in the case of an employee who resigns before completing ten years of service, he or she will only be eligible to withdraw the amount contributed to the account, minus any previous withdrawals.
Conclusion
In conclusion, GPF remains one of the most valuable retirement saving schemes that government employees have access to. It is essential to stay aware of the various details surrounding GPF, such as the contribution limits, interest rates, and withdrawal policies. These details can significantly impact the growth of an employee’s savings and, therefore, require careful attention. As a responsible employee, one must take advantage of the GPF scheme’s benefits to secure their future.
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