1. Savings for long term: It is one of the reliable savings options where an employee feels safe for a longer time.
2. Tax free: The contribution made by the employee and the employer is fixed and tax free at the time of withdrawal. Except in the case of premature withdrawal, where the amount is taxable.
3. Retirement benefits: Employee Provident Fund helps in collecting and saving money which eventually becomes the financial security at the time of retirement.
4. Medical emergency: An employee can withdraw up to 6 times of his salary or the entire contribution made, whichever is less; for the major surgical operations or for those suffering from paralysis, tuberculosis, cancer, or heart ailment.
5. Loss of income: It happens when an employee cannot work for a longer period of time then they can make use of these funds. The following are the situations :
6. Pension: An employer along with provident fund can also contribute for employee's pension fund as well.