Rajarajan (AO) (272 Points)
19 August 2009I believe that PF amount deducted every month from my salary can be claimed as deductions in the Taxable income. My question is whether the amount that the company pays every month for my PF can also be shown as deductions in my Taxable income too?
My PF contribution is paid to govt PF dept.
Can also the ESI be deducted to arrive at the taxable income.
Kindly clarify.
Rajarajan
CA Vikrant Arora
(Practicing Chartered Accountant)
(67 Points)
Replied 19 August 2009
| Originally posted by :Rajarajan | ||
| " | I believe that PF amount deducted every month from my salary can be claimed as deductions in the Taxable income. My question is whether the amount that the company pays every month for my PF can also be shown as deductions in my Taxable income too? My PF contribution is paid to govt PF dept. Can also the ESI be deducted to arrive at the taxable income. Kindly clarify. Rajarajan |
" |
Your own contribution to PF & ESI are deuctible u/s 80C , But the amount contributed by ur company is not eligible for any deduction.
Let me explain u this with a simple example :
Your Gross salary is 1000 per month. PF deducted is Rs.100 per month (Which ur employer will deposit with EPFO alongwith his own contribution)
You get net Salry in hand Rs.900 .
For Income Tax Point of view , your taxable salary is Rs. 1000 per month (12000 pa)
Lets assume , that is ur total income for the year.
You will get deduction u/s 80C for the amount contributed towards PF :- Rs. 100x12=1200 Rs.
Income after deduction of 80C is :- 10800 . Your tax will be calculated on that amount .
Whatever ur Employer company has deposited , is not eligible for any deduction for u..
CAclubindia
