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Pf withdrawal taxation

Tax queries 602 views 3 replies

Hi,

 I have one question wrt PF withdrawal taxation. My first employment with a X company was for 10.5 years and they maintained a separate PF trust (Registered). My current employment with Y company will end in another month (so 1.5 years) and they have Government PF account. I transferred PF amount from X to Y (government PF account). I am leaving my current company (, going abroad) and am looking to withdraw PF. Will I be taxed on withdrawal? I understand that, if it was a recognized PF trust, then it wont be taxed. I request your confirmation.

 

Thanks,

Ranga

Replies (3)

yes, recognized pf is based on EEE model whereas other pf trust are based on EET model so your withdrawal will get taxed.

Hi Triubuvan,

 Thanks for the reply. I want to bring clarity to my question,

- 10.5 Years of continous employment in X Company: PF handled by Recognised Provident fund handled by Company X

- 1.5 Years of continous employment in Y Company: PF Account in EPF

- On joining company Y, transferred the PF amount from RPF to EPF

- Leaving Company Y now (i.e., after 1.5 years of service) and looking to withdraw the EPF amount

The question is, will the withdrawn amount be taxed? 

Thanks,

Ranga

withdrawal is taxed if served for less than 5 continuous years. i read few articles to get clarity on continuous service... after reading them i am on the conclusion that you have been in continuous service for 12 yrs and hence your withdrawal will not be taxable.


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