Pf withdrawal

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 October 2011 Hi,

I'm transferring to USA based office of my employer which is parent company for period of 7-8 months. My current employer mentioned that I need to close my Employee Provided Fund (EPF) account as I'll be terminated from payroll in India office & transferred to USA office. I've worked for India office for around 4.5 months & have been working for overall 7 years. I was paying EPF for my prior employer & transferred the account to current employer immediately after closing the prior account. Please let me know if I need to pay income tax on the amount that I'll receive as a refund? Also is there any other way I can invest the amount & get a tax benefit. I've already utilized the complete investment limit under section 80C.

CA Prashant Shrivastava

CA Prashant Shrivastava (Expert)
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15 October 2011 If the amount withdrawn before 5 years from the date of deduction of PF then you have to pay income tax, however while refunding the amount if any TDS has been deducted from the PF withdrawal then you may claim take the credit of same.
You can further invest up-to Rs.20000/- in infrastructure bonds u/s 80CCF of the Income Tax Act, 1961.

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Querist : Anonymous

Querist : Anonymous (Querist)

19 October 2011 So if PF is being deducted since last 7 years which was deducted by previous employer for 3 years & current employer for 4 years, I don't need pay any income tax on the same?

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