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PF withdrawal after 5 years


Vinay verma (CA FINAL STUDENT)     20 January 2020

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One of my friend resigned from a job from Private sector after completion of 5 years. Now he has switched to Govt. job. There is no option of transfer account. He wants to withdraw PF amount. What will be the taxability. How much amount exempt and how much included in taxable income? Also consider 10% TDS.

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rama krishnan   21 January 2020

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Withdrawal after 5 years won't attract taxability. moreover to be absolute, deposit that withdrawn amount to new pf account

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Ganapathi Kamath   21 January 2020

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Full amount can be withdrawn. file FORM 31

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Vinay verma (CA FINAL STUDENT)     21 January 2020

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No tax liability on withdrawal after 5 years? what about employer's contribution and Interest part?

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Ganapathi Kamath   21 January 2020

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It can be withdrawn too using Form 31

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Vinay verma (CA FINAL STUDENT)     21 January 2020

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Ok... thanks .. but computation given by previous company charged tax on Employer's cont. and interest part.

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Ganapathi Kamath   21 January 2020

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Maybe the PF holder had not completed 5 years of service at that time. PF withdrawal before completion of 5 years of service attracts TDS at 10% on providing PAN and 20% in case of failure to provide PAN.

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Vinay verma (CA FINAL STUDENT)     21 January 2020

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Ok thank u

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CA Arun Tiwari (Partner)     23 January 2020

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if you are withdrawing the amount from pf after completing 5 years of service then no TDS will be deducted. however if you are withdrawing pf amount even 1 day before 5 years then 10% tds will be deducted if amount is more than Rs. 50,000.

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Vinay verma (CA FINAL STUDENT)     23 January 2020

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What about part of amount included in our ITR? If more than 5 year or less than 5 year? like Employer's Cont., Employees Cont. and Interest part.


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