There are so many rules of EPFO, which you should know about. If you’ve been with a company for 10 straight years, you can qualify for a pension under the Employee Pension Scheme (EPS) when you retire, according to EPFO rules. But what if you worked for 4 years, then lost your job and took a couple of years to find a new one? How does that affect your total working years for pension eligibility?

 

Will your experience reset to zero with the new job, or will the time from your previous job count towards the new one, even with the gap? This is a question many employees have. Let’s break down the rules to clear up any confusion.

 

What’s the deal with a long break in your career? Don’t stress too much. When you start a new job, just make sure to use the same UAN (Universal Account Number) from your last job. This way, your new employer can transfer your EPF contributions to that account. Plus, the time you worked at your previous job will be added to your new one, so you won’t have to start over to reach that 10-year mark for pension eligibility.

 

Here’s a breakdown with an example

 

Let’s say you’ve been with a company for 5 years and then find yourself out of a job. After a year, you land a new position. The good news is that your previous service isn’t lost. If you keep using the same UAN (Universal Account Number) at your new job, that one-year gap won’t count against you, and your service time will pick up right where it left off. So, if you stick around for another 5 years at the new job, you’ll have a total of 10 years of service, which makes you eligible for the Regular Pension Scheme.

 

Now, if you haven’t hit that 10-year mark and don’t plan to continue working, you can take the money out of your Pension Account before you reach retirement age. Just keep in mind that you won’t earn any interest on it.

Your pension benefits will be calculated using a specific formula based on your total years of service and your last salary. The formula for figuring out the EPF pension is: Monthly pension amount = (Pensionable Salary x Pensionable Service) / 70.