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Provident fund income on ITR- 1

Ravikiran T (IT) (23 Points)

04 July 2018

Dear All,

I have withdrawal my PF amount partially due to marriage expenses last year (without any termination of my employment). Where I can disclose this income in ITR-1 as exempted Income.

Please help me on this subject.

Regards,

Ravikiran

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3 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (175687 Points)
Replied 04 July 2018

Schedule 'Taxes Paid and Verification'

27	Exempt income (For reporting Purposes)
	a	Sec.10(38) (Exempted Long term Capital Gains)
	b	Sec.10(34) (Exempted Dividend Income)
	c	Agriculture Income (≤ Rs.5000)
	d	Others
		Sl.No	Nature of Income	Descripttttion ( If 'Any Other' selected)
		1	(Select)	NA
		2	(Select)	NA

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KOUSHAL JAIN (Chartered Accountant) (471 Points)
Replied 04 July 2018

Contribution towards an EPF account provides a benefit to individuals by way of a deduction under Section 80 C (see how here). It would also be good to know what would be the income tax implications of EPF withdrawal. Interestingly, EPF withdrawal is taxable under certain circumstances and exempt under the certain circumstances.

The following table will help you easily understand the taxability on withdrawal of EPF:

Serial No	Scenario	Taxability
1	Amount withdrawn is < Rs 50,000 before completion of 5 continuous years of service	No TDS. However, If the individual falls under the taxable bracket, he has to offer such EPF withdrawal in his return of income
2	Amount withdrawn is > Rs 50,000 before completion of 5 years of continuous service	TDS @ 10% if PAN is furnished; No TDS in case Form 15G/15H is furnished
3	Withdrawal of EPF after 5 years of continuous service	No TDS. Further, the individual need not offer the same in the return of income as such withdrawal is exempt from tax
4	Transfer of PF from one account to another upon a change of job	No TDS. Further, the individual need not offer the same in return of income as it is not taxable.
5	Before completion of 5 continuous years of service\ if employment is terminated due to employee’s ill health The business of the employer is discontinued or the reasons for withdrawal are beyond the employee’s control	No TDS. Further, the individual need not offer the same in the return of income as such withdrawal is exempt from tax