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Provident fund contribution taxability???

Roshan A (Chartered Accountant) (458 Points)

19 December 2011

Hello Guys,

I would like to know is PF contributions taxable on withdrawal??

Thanks in Advance,

Roshan

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12 Replies

neeraj (CA) (930 Points)
Replied 19 December 2011

I think NO it is EEE scheme

Roshan A (Chartered Accountant) (458 Points)
Replied 19 December 2011

what is EEE scheme??

CA Ketan Waghela (Partner at Elite Educare) (356 Points)
Replied 19 December 2011

Roshan ji,

If that PF is URPF then there will be tax liability on Employer's contribution and interest thereon under the head salaries and the interest on employees contribution will be taxable under the head income from other sources.

@*CS Siddharth Bumb. * (B.Com, CA Final, CS ) (5270 Points)
Replied 19 December 2011

if provident fund is recognised and statutory then it will be exempt and in case of unrecognised it will be taxable

CA Hardik Bunha (self) (2121 Points)
Replied 19 December 2011

UNRECOGNISED PF - TAXABLE

RECOGNISED PF - EXEMPT

STATUTOTY PF - EXEMPT

INTEREST OF PF EMPLOYEE CONTRIBUTION - TAXABLE

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 19 December 2011

Originally posted by : Roshan Alwani
	Hello Guys, I would like to know is PF contributions taxable on withdrawal?? Thanks in Advance, Roshan

taxable if withdrawn without completion five completed years of contribution

exempted thereafter

* Krishna * (CA Student) (6149 Points)
Replied 19 December 2011

Agreed with US Sharma. Five year continuous working period may be with different employers.

@ Roshan: EEE means Exempt-Exempt-Exempt at various stages i.e.Deposit-Accrual-Withdrawal.

neeraj (CA) (930 Points)
Replied 20 December 2011

EEE means Exempt on deposit , exempt interest exempt on withdrawal.

Rajnikant Vadigoppula (CA, CS And CMA Final) (919 Points)
Replied 20 December 2011

yes i agree with U S Sharma

taxable if withdrawn without completion five completed years of contribution

exempted thereafter even in case of recognised provident fund

Kolluru Krishna Murty (Partner) (315 Points)
Replied 20 December 2011

The position is as follows:

1.Employer's contribution upto 12 % of salary(which is normal )along with interest at Statutory rate (rate as declared by Central Provident Fund Trust(CPFC)) is exempt.

2.Employee's subscripttion upto12 % of salary(which is normal) along with interest at Statutory rate(rate as declared by CPFC) is exempt.

3.If the employer follows these guidelines,if it is privately managed Trustby employer,the withdrawls are fully exempt.

There is no such restriction as 5 years now for getting exemption.

kkm

Roshan A (Chartered Accountant) (458 Points)
Replied 21 December 2011

Guys thanks for your reply...but i think what Siddharth ,Ketan & Hardik said is for taxability at time of Contribution and not at time of withdrawal....

Correct me if i am wrong