Tax treatment relating to provident funds
| particulars | Statutory PF | Recognized PF | Unrecognized PF | PPF |
| Constituted under | Provident funds act ,1925 | EPF and Misc. provision act,1952 7 recognised by commissioner of PF and CIT | Not recognized by commissioner of income tax | Public provident fund ACT ,1968 account in SBI or post offices |
| Contributed by | Employer and employee | Employer and employee | Employer and employee | All assesses independently |
| Assessee’s contribution | Deduction u/s 80C | Deduction u/s 80C | Not income tax benefit | Deduction u/s 80c |
| Interest credited | Fully exempt | Exempt upto 9.5% p.a. any excess is taxable | Interest on employer contribution is taxable under other sources . interest on employer’s contribution is not taxable at the time of credit. | fully exempt |
| Withdrawal at the time of retirement | Exempted u/s 10(11) | Exempt u/s 10(12) subject to condition. | Employees contribution and interst theron is taxable .Employer contribution and interest theron is taxble as profit in lieu of salary ,under ‘salaries’ | Exempted u/s 10(11) |
| Employer contribution | Not taxable | Amount exceeding 12% of the salary is taxable | Not taxable at the time of contribution |
Note: Sum received by an employee under approved superannuation fund is also an exempt from tax u/s 10 (13) . salary for the purpose of provident fund is basic salary + DA (considered for retirement benefit ) + commission as a fixed percentage of turnover.
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Dear Team
I’ve worked in LIC for 4 years from 2010 to 2013, where my PF was deducted regularly.
After leaving the organisation, I asked for transfer of PF to my new employer…..but they replied that PF can-not be transferred as it is managed by LIC trust.
Finally,after another 3.5 years of mails & follow-up, I’ve finally received my PF of 1,98,000 in Jan, 2017……& 10% TDS is also deducted……I.e. I recieved Rs. 1,78,200 nett.
As per my wisdom, I’m wrongly charged TDS & the same should be refunded.
Now, I think that I should belong to that category of recognized PF….where tenure of service is less than 5. years……but TDS should be exempt, as PF transfer was not possible.
Kindly elaborate & suggest/ give your valuable opinion.
Waiting…….reply to the above query…..I need to file my income tax accordingly.