EPS pensioners alert! EPFO has this good news for you - Check if are you eligible for this gain

Employees' Provident Fund Organisation (EPFO) has good news for those EPS pensioners who have completed 15 years of their retirement by April 2020. The EPFO is now going to disburse 100 per cent pension to all such EPS pensioners from May 2020. As per the EPFO rules, those who chose to withdraw one-third of their lumpsum EPS balance used to get two-thirds of their EPS balance in monthly pension. But, EPFO changed this norm in February 2020 and the new EPFO rule says, those who have completed 15 years of retirement, they will get 100 per cent pension from May 2020.

Speaking on the EPFO benefit to near 6.3 lakh EPS pensioners Manikaran Singhal, a SEBI registered tax and investment expert said, "This EPFO rule used to exist till 2009.  But, in 2009, a new rule was introduced where a retired person was given an option to withdraw one third of their EPS balance as lump sum amount, which is income tax exempted. But, by opting the EPS withdrawal option after retirement, the EPS account holder gets monthly pension on the balance two-third of the EPS balance. Now, in the changed EPFO rules, an EPS account holder who has completed 15 years by April 2020 will be eligible for the 100 per cent pension from May 2020."

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EPFO rule for EPS pensioners

Nodding the views expressed by Singhal; another SEBI registered tax and investment expert Jitendra Solanki said, "According to the EPFO rules of the Employees Pension Scheme (EPS), EPFO members who retired before 26th September 2008 can receive a maximum of one-third of their pension as a lumpsum. The remaining two-thirds of the pension they get as monthly pension. This step will prove beneficial especially for those EPFO pensioners who opted one third lump sum EPS balance withdrawal and now have completed 15 years of their retirement. Now, after choosing the commuted pension, from May 2020, those EPS pensioners are now eligible for 100 per cent pension."

What is commuted EPS pension?

On what does it mean by commutation of pension, Solanki said that if the Provident Fund (PF) account holders are entitled to receive the pension amount every month after their retirement, a lump sum in advance, it is called commutation of pension.