MF QueryBoard

I have caught myself in a peculiar situation. In 2021, in the month of February, I made a partial withdrawal from my EPF for my elder son's education, but currently, I need to withdraw again for the same purpose. Is it possible? - Ritesh Sharan[EasyDNNnews:PaidContentStart]

Yes, you can make multiple withdrawals from EPF for the same purpose, but there are some restrictions. For example, you can withdraw up to three times for the purpose of marriage or higher education of children, but each withdrawal must be after a minimum interval of five years from the previous withdrawal. 

You can also withdraw up to three times to purchase or construct a house, but each withdrawal must be after a minimum interval of one year from the previous withdrawal.

There are no limits on the number of times you can withdraw for special cases, such as medical treatment or unemployment. However, you can only withdraw up to 75 per cent of your EPF balance for special cases. To make a withdrawal from your EPF account, you can submit an online application or visit your nearest EPFO office.

Things to keep in mind when making multiple withdrawals from EPF:

■ Each withdrawal is subject to a tax deduction unless you meet certain criteria, such as being unemployed for more than two months.
■ Making multiple withdrawals can reduce your EPF balance and your eventual retirement benefits.
■ If you withdraw your EPF balance before retirement, you may be required to pay an exit tax.

It is important to carefully consider your needs before making a withdrawal from your EPF account. If you are unsure whether or not you should make a withdrawal, it is a good idea to consult with a financial advisor.
 

I want to gift my mutual fund units as a gift to my granddaughter who turns 15 this year. What is the best way to transfer? Please let me know. - Nayan Sethi

I f you're wondering about the possibility of transferring mutual fund units as a gift to your grandchildren, the answer is that it's not possible. Mutual fund units are non-transferable, which means you cannot directly gift the mutual fund units that you hold jointly to your granddaughter. Nevertheless, there are alternative approaches you can take to invest in mutual funds for your grandchildren. Here's how:

1. Invest in Their Names - To invest in mutual funds for your grandchildren, you'll need to first redeem the mutual fund units you intend to allocate to them. If your grandchildren are aged 18 or older, you can redeem your current investments and transfer the proceeds to their respective bank accounts. Following this transfer, your grandchildren can initiate their own mutual fund investments through their bank accounts. In the case of grandchildren under 18, their legal guardian, typically their mother or a court-appointed representative, can manage these investments on their behalf.

2. Designate Them as Nominee - Another option is to maintain the mutual fund investments in your own name while designating your grandchildren as nominees. This arrangement ensures that in the event of your unfortunate passing, the ownership of the mutual fund units will automatically transfer to your grandchildren.

While directly gifting mutual fund units to your grandchildren isn't feasible due to non-transferability, you can still invest in mutual funds for their benefit by employing the methods described above. Thank you for writing to us.

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