The GPF full form is General Provident Fund. GPF is a kind of PPF account that can be avail only by the government employees and it is managed by the government of India.
Here, Government employees are allowed to save some part of their salary in the General Provident Fund. It will be paid back to the employees which he/she had save during their whole employment term at the time of retirement or superannuation.
Employees will get a certain interest rate on the fund deposited by them but it may change from time to time as per government’s notification.
In current scenario, they will get an interest rate of 8% per year. This is a risk-free long-term scheme for the government employees.
Generally, there are three types of provided fund available such as General Provided Fund, Public Provided Fund (PPF), and Employees Provided Fund (EPF). They are different as per their features, the contributions, the terms and conditions and other benefits available.
Eligibility for GPF
Employees who meets all the eligibility criteria provided below can avail the facility of GPF account:
- You have to be an employee of government of India as well as a resident of India.
- After a certain level of salary, it is compulsory to have this account.
- If you are working in a private organization, then you cannot avail this service.
- You just contribute a certain amount of fund from your salary and you will be a part of the GPF account.
How GPF Works?
- It is a tool used by the government of India for the government employees to create a fund for future. They paid some certain amount to this account. The total amount with certain interest set by government will be return to you after retirement or superannuation.
- You must provide the name of a nominee of your choice. If any accident happens to the employee, then all the benefits will be avail by the nominee.
- One can avail an interest-free loan from this account which is known as GPF advance.
Special Features of GPF
- If someone start paying fund from their salary in this account, according to the Pensioner’s official portal they will become the permanent member of this scheme. The amount they will paid not be lower than 6% of their salary and can be up to 100%.
- At the time of joining this GPF account, you must submit a nominee from your family member who is suitable and will get all the saved money in the GPF account. No document proof will be required after maturity when the saved fund will withdraw from the GPF account.
- When one will get retirement from duty, an order is issued immediately for withdrawal and will be transferred to within the week on any working day. No application is required to submit for this type of withdrawal is one of the best advantage of this type of saving.
- If any account holder of GPF dies, then nominee of the account holder will get an extra amount. The amount will be equivalent to the amount that is paid by the account holder proceeding for last 3-years at the time of his/her death and also other terms and conditions will be followed. Generally, the extra amount will not exceed Rs. 60000. This benefit will be given to those who was in service for minimum of 5 years when he/she dies.
- You don’t need to pay any amount three months before the date of retirement as per pensionersportal.gov.in.
- For any reason, if the account holder left his/her service, then they will be eligible to withdraw the amount saved in GPF account.
- According to the interim budget of 2019-20 of central government, having income of Rs. 6.5 lakh per annum which is taxable can get the benefit of “tax rebate” if they invest Rs. 1.5 lakh in Public Provident Fund (PPF), General Provident Fund (GPF) and in the form of insurances. This was effected from April 1, 2019.
Difference Between PPF and GPF
Eligibility: Anyone can save/invest their money in PPF, on the other hand, person working only in the government organization can invest their money in GPF. They must be a resident of India who have joined government organization before 1 January 2004. In case of PPF, people aged 18 can invest. One PPF account is provided against every individual.
Maturity Period: GPF will get maturity only at the time of retirement of superannuation. PPF will be matured after 15 years when you open the account.
Deposit Limit: In case of PPF minimum amount of contribution is Rs.500 per year and maximum amount is Rs.1.5 lakh per year and a maximum of 12 times is allowed in a year, on the other hand, in case of GPF, minimum employee’s contribution is 6% of the salary and maximum contribution is 100% of the employee’s salary.
In a word, we can say that PPF is optional i.e. any citizen can avail this facility at their will but on the other hand GPF is compulsory to all the government employees.
Related Full Forms:
GPF Full Form: FAQs
Q1. What is the full form of GPF?
Ans: The full form of GPF is General Provident Fund.
Q2. Who can avail the facility of GPF?
Ans: The facility of GPF can be avail only by the government employees after a specific salary slab.
Q3. What is the deposit limit of GPF?
Ans: A government employee can invest minimum 6% of their salary and maximum of 100% of their salary.
Q4. When would I get my amount back from the GPF account?
Ans: At the time of retirement or superannuation, you will get the saved amount with certain interest from your GPF account.
Q5. What is the interest rate on GPF?
Ans: The interest rate is subject to change and the current rate is 8% per annum.
Q6. Is any kind of tax will be imposed on GPF amount?
Ans: No tax will be imposed on the GPF amount.
Conclusion
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