Quick Summary
The Central Board of Direct Taxes has released the Income-tax (25th Amendment) Rules, 2021 to further make amendments to the Income-tax Rules, 1962. As such, after Rule 9C, a new rule 9D has been inserted which lays down provisions for Calculation of Taxable Interest Relating to Contribution in a Provident Fund or Recognised Provident Fund, Exceeding the Specified Limit. Relevant text of the new Rule is as follows 9D. Calculation of taxable interest relating to contribution in a provid
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FAQ :
Rule 9D has been inserted to provide guidelines for calculating taxable interest on contributions made to provident funds or recognised provident funds that exceed a specified limit.
The rule requires separate accounts to be maintained from the previous year 2021-2022 and for all subsequent previous years.
Individuals must maintain separate accounts within their provident fund for taxable contributions and non-taxable contributions.
Taxable interest refers to the interest accrued during the previous year on contributions that are not exempt from inclusion in a person's total income under clauses (11) and (12) of section 10.
The rule applies to contributions in a provident fund or a recognised provident fund, where the contribution exceeds the specified limit.
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