Pre 5 year withdrawal for pf

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This query is : Resolved

Udgam Koomar (Querist)

23 August 2015 I have searched this forum regards tax implications of PF Withdrawal with NOT competing 5 years rule, could not get a clarification, so by example I am trying to get a response, expert please comment.

(a)PF amount received 3,00,000/-

(b)Employers contribution: 140000/-

(c) Employees Contribution 160000/-

The assesse is in 30% tax bracket for his other regular income. So now whle calculating tax, should the entire amount (a) be added to his head 'income from other sources' and be taxed at 30% OR only (b) amount will be added to head 'Income from salary', AND portion (c) will not be added to any head, as its not taxable only interest generated from this contribution may be added to head 'other sources' (please correct is Employees contribution is taxable in this case) AND then the tax be calculated accordingly.

Also how will the interest be calculated on employers and employees contribution OR how can I know as the EPFO does not issue any detailed statement regards interest breakup. Also for earlier years when this PF exemption was taken under 80C and tax savings was made, does one have to pay taxes for those years too?? If yes, how to calculate those taxes?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

23 August 2015 a) Employers contribution add to salary.
b) Employees contribution add to salary and claim relief in case earlier years you were not in 30% bracket. 80C claim has to be withdrawn and effect has to be worked out to claim relief.
c) Work out interest and add it other income. See annual PF statement interest break up will be there.

For earlier year tax relief claimed u/s 80C we have to pay tax during the current year showing it as income.

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