Payments to the ‘inoperative accounts’ at the Employee Provident Fund Organisation (EPFO) has increased in recent times, thanks to the steps taken to identify the owners.
EPFO said Rs 4316 crore was paid to the beneficiaries last year, while it continues to hold over Rs 27448 crore in inoperative accounts.
EPFO tries to identify holders of those inoperative accounts and return the sums. It also regards accounts to which no contribution is made as ‘inoperative’.
“All such Inoperative Accounts have, however, definite claimants,” EPFO claims.
EPFO’s annual accounts as on March 31, 2014 showed Rs 27,448 crores in the inoperative accounts. When employees switch jobs and fail to transfer funds to their present account letting them go inoperative in 36 months.
Employees also leave the funds untouched since interests earned on the deposits are exempted from tax. The deposits remain safe and cannot be attached even by a court decree.
The EPFO tries to assist holders of inoperative accounts through the portal ‘Inoperative Accounts Online Help Desk’ and has also assigned Universal Account Numbers (UAN) to help them identify their accounts without the employer’s intervention.
“As a result of the above steps, the total amount paid to the beneficiaries from inoperative accounts has shown an increase in the last three years,” EPFO said.