Taxation of Employee Provident Fund (EPF)

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• Dear Sir,
  I have retired from service at the age 59 from a company. But my service period is less than 5 years. Please advise whether my PF withdrawal amount is taxable. Retirement was not in my control
  Thanks

  • Dear Francis,
    Yes, it is taxable.

• I had worked for a company for more than 5 years but during these five years I got an opportunity that was offered by the company itself to go outside India for a project having a tenure of one year. As I went outside India I was not liable to the any law/provisions in India and therefore no PF was deducted and paid to the PF authorities during that year. Now, I had withdrawn my PF so wanted to know that as I was out of India and my PF was not deducted in that particular year will my withdrawal be taxable or will it be exempt as I have served the company for a period of five years

  • Dear Kanishka,
    As per me, they consider your EPF as less than 5 years of age.

• sir , i was in service in a school as teacher. I got retired from my job on 31/08/2014 and accordingly my pf was also deposited till that date. But till now i did not withdraw my epf balance that still in my epf a/c. recently i observed my pass book with my UAN no, then i find that the interest on my pf balance was given upto 31/08/2017 on 31/03/2018 for year 2017-18.
  it appears that they gave me interest upto 3 years only from my retirment, but as i now from 2016 , interest on inoperative a/cs has been allowed without any limit of years.
  please clearify the legal position on it , if there is any mistake the remedy of it also.
  i will b highy oblidged for your advice

  • Dear Atul,
    Refer my post "Tax on EPF after resign, retire or terminated".

• Dear Sir,

  I am having query about the ITR filing. As of Now my resident status is NRI and I have withdraw my PF in FY 2017-2018 and TDS deducted on PF amount.

  Now I am filing ITR so can we claim for refund of TDS if income is less than 2.5 Lac?

  • Dear Pawan,
    YES.

    • Dear Sir,
      Thanks for your response.
      Kindly help on below points
      1. Is it mandatory to file ITR for NRI if income less than 2.5 Lac in India or No Income from any other source?
      2. Can we take the refund in NRO account?
      3. Is it mandatory to give the NRE account details during the ITR filing?
      Thanks

      • Dear Pawan,
        For all your doubts the answer is YES.

• Dear Sir,
  I recently with drawn RPF amounting to 59563 after 10% TDS, can I get this whole TDS amount refund ? and under which head I need to declare this income. I don't know the portion of interest, employee and employer contribution. and my income for this year is less then 2.5 lakh

  • Dear Mahaveer,
    If including this income your total taxable income is less than the basic exemption limit, then you can claim the TDS. This income is considered as income from other sources.

• Is pension of Rs.1996 per month received from EPFO comes under head'income from other sources' or under head 'salary' or this pension is exempt from income tax as per rules?

  • Dear Pawan,
    It comes under the head of SALARY.

• Dear Mr Tonagatti,
  Need your advice.

  I contributed towards EPF for LESS THAN FIVE YEARS, resigned from my job, but did not withdraw my accumulated balance for FOUR YEARS thereafter.

  Then I applied for full withdrawal and received the balance amount less TDS. No problem with that.

  However, on scrutiny of account statement I find that INTEREST ON ACCUMULATED BALANCE was credited only for THREEYEARSAFTER I RESIGNED FROM MY JOB. I read at the following link that interest should continue to be paid till the age of 58. https://www.basunivesh.com/2017/11/17/tax-on-epf-after-resign-retire-or-terminated/

  Is this provision of continued interest till 58 years applicable to those who have contributed for less than FIVE years? If yes, in your opinion will it help to apply to EPFO at this stage for recalculation of interest and payment for the period beyond three years?
  Thank you.

  • Dear Manish,
    If you withdrawn the money before this new notification, then you are not eligible for any interest.

    • Thank you.
      Have withdrawn the money only last month but I did not know about this notification. Can I make a claim for rectification?
      Thanks

      • Dear Manish,
        I don't think now they entertain.

• I joined a Company in January 2014 at the age of 56 years. I continued my service till March 2016 and resigned. The Company had recognised PF Trust. After resignation at the age of 58 years 3 months I did not work any where till September 2016 and from October 2016 I am working in an academic Institution where PF is not there so I can not transfer the PF now. My question is:

  1. I wish to withdraw my PF at my current age of 60 years and 5 months--whether it will be taxable?
  2. If taxable can I get any relief in terms of dividing the contributions and interest for the year 2016-17 when my income was nontaxable?

  • Thanks very much for your quick response. However, there is no consideration to the fact that I completed 58 years of ages to get the tax exemption?

    • Dear Sremmant,
      Sadly NO.

  • Dear Sremmant,
    1) As your EPF account is not more than 5 years old, it will be taxed.
    2) NO.

• Post Retirement how long can one keep EPF money with EPFO ?

  Is the interest accrued on this post retirement date - taxable?

  How do I calculate and pay the tax?

  (If a person retired in Jan 2017, and has not withdrawn the EPF accumulated amount till date, how long can he keep the account active with EPFO without withdrawing, what are the tax implications, how to calculate tax, if any. After paying tax, how long can I keep the account active)

  thanks

  • Dear SPS,
    Refer my latest post in this regard "Tax on EPF after resign, retire or terminated".

    • Dear Basavaraj, Thanks for the quick reply and links to the complete write-up.

      To reconfirm, tax is payable on interest accrued on EPF.

      After going thru the links and write up, have another query - The retirement age is being seen as 55 / 58, however what happens if person keeps working and contributing into EPF till 70 as a normal employee.

      Is the treatment any different or is it the same with only retirement age shifting to 70 instead of 58.

      thanks and rgds

      • Dear SPS,
        There is no clarity in this front from EPFO.

• Hi Basavaraj,

  I have recently moved to Canada and would like to know whether i would be charged with TDS @10%?

  In India i have worked for less than 5 years.

  Thanks
  Nayay

  • Dear Nayay,
    In that case the above shared TDS rate will be applicable.

    • Hi,

      Di i have an option to withdraw pension contribution as now i have a NRI status.

      Thanks
      Nayay

      • Dear Nayay,
        If you not completed 10 years of service, then you will receive part of it as per EPS Table D.

        • ok That is strange as by that time (10 years) i would not be an Indian citizen so i cant hold Aadhaar so i can nothing about my money. Right?

        • Dear Nayay,
          It is 10 years contributory period but not 10 years age of EPS.

        • ok Got it. Still it got deducted from my salary but i am not entitled to get it back.

    • Thanks. Appreciate the quick response.