Whats RPF?

Others 3630 views 1 replies
Whats the meaning of recognised provident fund? If contribution is made to unecognised pf no deduction is available u/s 40A(9). Then whats this recognised pf? 
Replies (1)
This fund is one which is recognised by the Commissioner of Income-tax in accordance with the rules contained in Part A of the Fourth Schedule to the Income-tax Act. Such provident funds are generally maintained by the private sector organizations. Unrecognised Provident Funds In so far as unrecognised provident funds are concerned, the employer's contribution thereto is not taxable from year to year nor is the employee entitled to tax rebate u/s 88 in respect of his own contribution thereto. The interest credited to such r. provident fund on year to year basis is not taxable because it will accrue to the employee only when he retires that is to say, the employee's entitlement to claim such interest arises only on retirement. When the employee retires; The payment received by him in respect of his own contributions will be exempt from tax, for the simple reason that his own contributions are from his income which has already been subjected to tax earlier. Interest on his (the employee's) contribution is taxable under the head "income from other sources" [GIT v. G.Hyatt 80 ITR 177 (SC)]. The balance amount comprising the employer's contribution from year to year and interest thereon is taxable under the head "salaries" (CIT v. G. Hyatt, supra). However, the assessee is entitled to claim relief u/s 89(1). Sorry i am unable to answer your 2nd question.Can i know the answer of that q ?sir


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register