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PF contribution deduction

Hemant Sony (Chartered Accountant) (32 Points)

27 July 2021

Dear sir/mem,

Will Employer's & Employee's Contribution to PF be included in salary income and then deduct U/s 80C in ITR? ( in case of Govt. & Non Govt. Employee)

If not then how they will be treat and shown in ITR?

Plz explain.

thank you.

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6 Replies

Surajsharma.bhaskar (Student) (30 Points)
Replied 27 July 2021

Both part of pf are included in salary and then deduction available u/s 80c

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 27 July 2021

Both are included and employees contribution will applicable for deduction u/s 80C

Hari Beldona (ACA) (1533 Points)
Replied 27 July 2021

Government employees get only NPS. NPS is compulsory for all central government/state government/public sector banks/companies employees. PF is personal choice for government employee. Government do not force for PF.
The government has raised the threshold limit of tax-exempt contributions to the Provident Fund (PF) to Rs 5 lakh (from Rs 2.5 lakh announced in Budget 2021), subject to certain conditions. This increased tax-exempt limit is applicable to only those PF contributions where there is no employer contribution.
TAX
Income tax rules: Tax on PF interest, reduction in time limit of ITR filing, other changes
Tax on PF interest
As announced in the Budget 2021, if deposits in Employees' Provident Fund (EPF) and Voluntary Provident Fund (VPF) by an employee exceed Rs 2.5 lakh in a financial year, then the interest earned on the contributions exceeding Rs 2.5 lakh will be taxable in the hands of an employee.

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Hemant Sony (Chartered Accountant) (32 Points)
Replied 28 July 2021

How can we show employer's and employee's contribution to PF in ITR?

Hari Beldona (ACA) (1533 Points)
Replied 28 July 2021

Only employees contribution is eligible for deduction u/s 80 C

Nidhi (Chief Accountant) (3150 Points)
Replied 29 July 2021

Only Employee's contribution is included in salary and can be eligible for deduction u/s 80C in income tax return of employee.

employee have nothing to do with employer's contribution.

1 Like