Tax on withdrawal of Employee Provident Fund

Save Share

This query is : Resolved

NK1976

NK1976 (Querist)

12 November 2025 Dear Sir,

I want to know what is the tax liability on withdrawals of Employee provident fund.
My services in company is more than 30 years and now i am withdrawing the full balance of EPF Account. Now it is large amount in EPF account. I am the senior citizen and getting salary from the company and regularly filing the income tax return. I want to know the any tax on withdrawal of EPF Balance amount or it is exempt from income tax.

Thanks
N Kadam

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

12 November 2025 Regarding taxability, EPF withdrawals made while you are still employed are generally not allowed except for advances, and these advances have specific conditions but are mostly tax-exempt if you meet the continuous service criteria. Full withdrawal and the related tax exemption come into effect mainly after continuous service of at least 5 years and typically after retirement or termination of employment.

So, even if you have completed 30 years of service, you cannot withdraw your full EPF balance as long as you continue to be employed and active in the EPF scheme under the same or new employer. The tax exemption on full withdrawal applies predominantly once you exit service or retire.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now