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EPFO Tax above Rs 2.5 Lakh contribution

J S BHAVSAR (CONSULTING) (1288 Points)

04 October 2021

The EPFO has come up with a chakravyuh that even Guru Dronacharya cannot match.

https://www.rediff.com/business/column/why-is-modi-chipping-away-at-epfo/20211004.htm

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2 Replies

Rama chary Rachakonda (Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294) (5128 Points)
Replied 04 October 2021

People with Employees' Provident Fund and Voluntary Provident Fund (VPF) contribution of over Rs 2.5 lakh per financial year will now have two separate PF accounts. Finance Minister Nirmala Sitharaman had announced, in this year's budget, that PF contribution of more than Rs 2.5 lakh in a fiscal will be taxable

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J S BHAVSAR (CONSULTING) (1288 Points)
Replied 06 October 2021

Originally posted by : Rama chary Rachakonda
	People with Employees' Provident Fund and Voluntary Provident Fund (VPF) contribution of over Rs 2.5 lakh per financial year will now have two separate PF accounts. Finance Minister Nirmala Sitharaman had announced, in this year's budget, that PF contribution of more than Rs 2.5 lakh in a fiscal will be taxable

Who will pay or deduct the tax on that interest earned above 2.5 lakh contribution, when will the tax get paid if the interest itself does not get computed till November every year, and if there is to be a TDS on that interest then who will deduct TDS?

These details are not available from Income Tax government or CBDT.

From last 6 years the interest on Provident Fund is getting credited only around November December. The current government has made the interest crediting action as a "Diwali festival event" to be celebrated.