Need Help Reporting EPF & EPS Withdrawal in ITR

Hello,

I have withdrawn my EPF & EPS completely this year. I had not completed 5 years service and hence some amount is taxable. I need help in understanding how this should be reported when I file ITR next year.

Here's what I have already figured out -

A - Employee’s contribution - Not taxable, should be reported under exempted income under section 10(11)

B - Interest on employee’s contribution - Taxed as income from other sources

C - Employer’s contribution - Taxable as profits in lieu of salary under section 17(3)

D - Interest on employer’s contribution - Taxable as profits in lieu of salary under section 17(3)

E - I have claimed EPF for deduction under section 80C in past. Since I didn't complete 5 years of service, this is now void and I need to report it as income in current year.

What I can't figure out -

1 - Whether EPS (pension) is taxable, and under which section it should be reported

2 - With reference to point E above, under which section should I report this amount as income?

3 - With reference to point E above, let's say in one of the previous years the deductions claimed under 80C were: 1.5 lakh PPF, 25k insurance premium, 28k EPF. In this case my 1.5 lakh investment limit under 80C is being exhausted by investments without taking EPF into consideration. Do I still need to report 28k EPF as salary income this year?

Thank you in advance for any helpful insight.

Hey RSKINDIA, here’s a detailed guide to help you report your EPF & EPS withdrawal correctly in your ITR:

1. Taxability and Reporting of EPS (Employee Pension Scheme)

EPS amount withdrawn before completing 10 years of service is fully taxable as salary income.
It should be reported under ‘Income from Salary’ in your ITR.
There isn’t a separate head for EPS withdrawal, so include it as part of your salary income under ‘Profits in lieu of salary’ (Section 17(3)).

2. Regarding Reversal of 80C Deduction on EPF Contribution

Since you claimed deduction for EPF contribution in earlier years under Section 80C but withdrew before completing 5 years, you have to add that EPF employee contribution amount previously claimed as a deduction back into your income now.
This amount should be reported as ‘Income from Salaries’ under ‘Profits in lieu of Salary’ (Section 17(3)) — just like the employer’s contribution and interest on employer’s contribution.

3. Reporting When 80C Limit is Exhausted by Other Investments

The fact that your other investments (PPF, insurance) already exhaust the 1.5 lakh Section 80C limit does notaffect the reporting of the EPF reversal amount.
The reversal amount (the EPF employee contributions for which deduction was claimed earlier but service tenure < 5 years) is treated as income, not a deduction. So it is added to your taxable salary income for the year of withdrawal.
So yes, you must report the 28k EPF amount as salary income this year, regardless of your other 80C investments.

Summary for your case:

Item	Taxability	Reporting in ITR
Employee's Contribution	Exempt under Section 10(11)	Exempt Income (Schedule EI / Exempt Income)
Interest on Employee's Contribution	Taxable as Income from Other Sources	Other Income (Schedule OS)
Employer's Contribution	Taxable as Salary (Profits in lieu)	Income from Salary (Section 17(3))
Interest on Employer's Contribution	Taxable as Salary (Profits in lieu)	Income from Salary (Section 17(3))
EPS withdrawal (if service <10 years)	Fully Taxable as Salary	Income from Salary (Section 17(3))
Reversal of EPF deduction claimed under 80C	Taxable as Salary (Profits in lieu)	Income from Salary (Section 17(3))

A few practical tips:

Ensure your Form 16 or employer salary slip reflects these components properly.
Maintain records of EPF and EPS withdrawal certificates for reference.
Use the ITR utility’s relevant schedules to enter exempt income and salary income separately for clarity.