How to merge two PF accounts, and is a withdrawal taxable?

I worked with two companies from 2018 to 2022, and 2022 to 2025. Both opened two different provident fund (PF) accounts with two different universal account numbers (UANs). My current organization, which I recently joined, does not offer PF, so I cannot transfer my previous PF accounts. How can I merge the two accounts? Alternatively, if I want to withdraw from the first account, is it allowed, and will it become taxable? My continuous years in service are 7 years, 5 months.

As per the guidance in the handbook available on the Employee Provident Fund Organisation (EPFO) website, in case two UANs are allotted to you, the latest UAN linked to your last employer should be retained, and the older one linked to your first employment must be merged. The transfer of PF balance to the latest UAN must be done by filing Form 13 online on the unified member portal. For that, KYC must be updated on your latest/active UAN. Further, as per the guidance, it is suggested that you report the matter to your previous employers and to EPFO by email (ua****@**********ov.in), mentioning both UANs. After due verification, the previously allotted UAN will be blocked, and the second UAN will remain active.

Regarding withdrawal of accumulated balance from the first account, an employee is eligible to withdraw their provident fund accumulations if they are not employed with an establishment covered under the EPF Act for a continuous period of two months. Since you are currently employed with an organization that does not provide EPF coverage, you are eligible to apply for withdrawal (subject to completion of two months from your last employment) from your previous PF accounts.

Regarding taxability of PF withdrawal, it may be noted that as per the provisions of Income-tax Act, 1961 (‘the Act’), it is considered as tax free, provided the employee has completed five years or more of ‘continuous service’ with the employer. Where the employee obtains another employment and transfers the earlier PF balance to the PF account with the subsequent employer, then the employment period with the previous employer is also counted for the five-year criteria.

In the instant case, in case you obtain the withdrawal from the first account itself (and do not transfer the balance to the second PF account), then the same may be considered taxable in case your service tenure with the first employer does not fulfil the five-year criteria. However, in case you transfer the balance in the first account to the second account and subsequently withdraw funds from the second account, the service period with both the previous employers shall be considered for this period, and as it exceeds the five-year continuous service criteria, such withdrawal shall be considered as non-taxable. It may be noted, however, that any interest accrued on the PF balances during the non-contributory periods will still be taxable.

Parizad Sirwalla is partner and head, global mobility services, tax, KPMG in India.