Hi Friends,
Suppose my CTC is 10,000 and it includes employer contribution of 1000 regarding PF. I just wanted to ask that this 1000 should be the part of my taxable salary or not.
I am in the view that it should not be the part of my taxable salary as it is the obligation of empolyer to contribute 12% of my Basic salary to My PF account.
Whats ur views?
Employer Contribution Towards PF will be exempt upto 12% of Basic Salary and in excess of 12% it will be taxable in the hands of employee.
| Originally posted by : Gajendra R. Tiwari | ||
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Employer Contribution Towards PF will be exempt upto 12% of Basic Salary and in excess of 12% it will be taxable in the hands of employee. |
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What Gajendra wrote is correct
enployer's contribution toward provident fund is exempt as follows:
STATUTORY PROVIDENT FUND : FULLY EXEMPT
RECOGNISEPROVIDENT FUND : UP TO 12% OF SALARY***
UNRECOGNISE PROVIDENT FUND : EXEMPT AT THE TIME OF PAYMENT BUT TAXABLE WHEN WITHDRAWN.
***SALARY FOR THIS PURPOSE INCLUDE BASIC + D.A. (IF IT IS TAKEN FOR RETIREMENT BENIFIT).
YUP it wont be taxable,once it crosses the 12% mark then then the surplus amount i e the amount above 12% would be taxable.
Employer's contribution will not treat as your taxable salary upto 12%
CAclubindia
