HI,
Recently I come to know that if you are unemployed and you continue to hold epf account, you are liable to pay tax on interest that you receive on epf account from the date of unemployment. I have below questions:
1. If a person has completed a tenure of more that continuous 5 years but he has not withdrawn any pf amount, should he report income from interest on pf account from the time he is unemployed. For e.g person was employed from 2010 to 2016. now he is unemployed from 4 years but has not withdrawn any amount from pf account till 2020. Should he report interest income that he received each year from 2016 till 2020. Please not person has not withdrawn any pf and not interested in withdrawing pf in upcoming years also, but he continue to receive interest on pf account.
2. If a person needs to report interest income, should he report it on accrual basis each year even though he is not withdrawing the amount. Under which salary head of itr1 this interest income should be reported. if he is not reporting each year on accrual basis than there will be huge tax liability when he finally withdraws.
Thank you
CAclubindia
