Epf deduction for tds on salary

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Soumya

Senior Accounts Executive

93 Points Posted on 02 July 2016

Dear All,

PF contribution by employer and employee.

Can an employee get tax exemption on total PF contribution (by employer and employee).

Suppose

Basic salary : Rs.10,000/-

PF by employee : Rs.1,200/-

PF by employer : Rs.1,200/-

Which amount an employee can claim in tax deduction.

Please help.

Replies (3)

CA. Karthik Reddy MNS

Practicing Chartered Accountant

65 Points Posted on 02 July 2016

Employe'sr contribution towards PF is exempt from tax and employee's contribution is eligible for deduction u/s80C to the extent of 12% of salary depending up on type of PF(i.e.,SPF or PPF).

Shreesh Kumar

CA Final

94 Points Posted on 02 July 2016

Dear Soumya,

However you didn’t clarified that what scheme you have opted for provident fund I would like to give you extensive information in regard to different Provident Fund Schemes.

There are basically three kinds of schemes available for employees which are:

Recognized Provident Fund(RPF)
Unrecognized Provident Fund(URPF)
Statutory Provident Fund(SPF)

Following table is summary showing tax treatment of provident Fund:

Fund	Employee's Contribution	Employer's Contribution	Interest on PF
RPF	Deduction u/s 80c available	Exempted up to 12% of salary(Exceeding 12% shall be added to salary hence taxable)	Exempted upto 9.5%(Exceeding 9.5% shall be added to salary hence taxable)
URPF	No Deduction available	Any amount of contribution Not Taxable	Not Taxable
SPF	Deduction available u/s 80C	Fully Exempted	Fully Exempted

In your case it can be assumed that you have opted for RPF. Therefore employer’s contribution of 1200 which is not more than 12% of Basic salary will be exempted. Employee can claim deduction of 1200 of employee’s contribution u/s 80C.

Thanks and Regards

Shreesh Kumar

Mukesh Kumar

Accounts Manager

1292 Points Posted on 04 July 2016

DEAR SOUMYA G,

IN INCOME TAX EXEMPTION AND DEDUCTION IS TWO DIFFRENCE CONCEPT.

IF YOU WANT TO TAKE EXEMPTION BENIFT OF PF WHICH IS YOU WITHDRAWAL FROM YOU PF A/C ,

THAN YOU CAN TAKE BENIFIT U/S 10(11),10(12)

AND IF YOU WANT TO TAKE DEDUCTION BENIFIT AGAINST YOU TAXABLE INCOME THAN YOU CAN DEDUCTION YOUR WHOLE AMOUNT ONLY CONTRIBUTE BY YOU ( NOT YOUR EMPLOYEER) U/S 80C

BUT YOUR PAN CARD SHOUL BE INDIVIDUAL OR HUF

GOOD LUCK