EPF Account Idle and TDS deduction

Others 301 views 1 replies

Hi All,

If employee have EPF account which is no longer active as employee has left the country. The contribution is EPF + VPF.

Year of employment is 2.5 years and same EPF account age. Now If employee withdraw EFP+VPF before 5 year age from PF account establishment, then TDS will get deducted.

Now, Is this advisable for employee to wait 2.5 years more to complete 5 years to withdraw EPF + VPF in order to save TDS?

Please advice.

Thanks, 

Replies (1)

Yes,

If employee withdraws EPF before 5 years from registration in EPF, then the amount of EPF and Interest would be taxable in tha hands of employee.

If EPF is withdrawal is after completion of 5 years, then it would not be taxable.

So, it is better to wait for completion of 5 years and thereafter withdraw to save tax thereon.

 


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