Epf Withdrawal Taxation - Docx Download - CiteHR
Nathrao
Insolvency N Gst Professional
Abbasiti
Assistant Engineer, Indian Telephone Industries,
Renu.nagpal88
Hr Executive

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Dear Sir,
I need your advice EPF withdrawal taxation. My company E is rumoured to shut down & I have resigned. I worked for 15 months and want to withdraw the PF balance from company E. However,I also transferred PF balance from previous two companies A & C to this company E. Please refer details of the PF status & employment (in chronological order);

company name company left in time worked pf status
A 2011 42 months balance transferred to E
B 2012 9 months trust managed PF. Amount withdrawn
C 2013 11 months balance transferred to E
D 2014 12 months trust managed PF. Amount not transferred or withdrawn
E (existing co.) 2015 14 months amount not transferred or withdrawn

If I withdraw EPF balance of company C, will I be taxed during filing of Income Tax return ? Does the previous employers mean ''immediate previous employers" ? Company A & C (whose PF balance was transferred to E) are not immediate previous employers, though the total years worked for A,C & E combined is more than 5 years. Am i fulfilling the 5 year norms?

Can I withdraw only the EPS amount & keep the EPF balance intact?

If the organisation shuts down, how can I withdraw/transfer the PF? What options are available to me?

Kindly advise urgently.

Thanks & Regds,
Shardul Jani.
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Dear Shardul Jani,
If the total service in EPF is 5 years or more, you need not to pay income tax. Otherwise the EPFO itself deduct Tax and pay balance amount. Hence club all EPF services together and get exempted from IT.
Abbas.P.S
Please understand money in PF is held by the Government (EPFO) and not companies.Companies can shut down or wind up,as long as contribution of employees and employer share of PF is transferred to EPF,it does not matter whether company disappears after that.
Withdrawals before 5 years will attract tax in normal circumstances.
procedure to withdraw EPF amounts are there even if company winds up.
Dont worry money is safe.
Only what you should have is your EPF a/c number and UAN(universal Account number).
Hello friends, Thank you for helping me. I would request you to see attached file & again give a final verdict on withdrawal taxation. Warm Regards, Shardul.

Attached Files
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File Type: docx pf employment history.docx (13.7 KB, 139 views)

Suggest you transfer the PF amount transferred from D to E and then withdraw from E.
The total service is 67 months (excluding D) and this is more than 5 years membership in PF and therefore, should not attract any Income-tax.
Dear Mr. Abbas,
With reference to your above reply i am totally agreed with your point of tax deduction if we did the job below 5 years. But as per my knowledge if we submit Form 15G with PF form than Tax will not be deducted. Is the same is correct.
please let me know as i am suppose to withdraw my 4 years PF from my last employer. Do i have to pay Tax of 10% or i will submit Form 15G.
regards,
Renu
Thank you very much.......
But are you absolutely sure that it is not "immediate previous employer" that is considered for calculating 5 years? I will withdraw without TDS, but then it should not be taxable when I file returns.
Form 15 G is for avoiding tax deduction at source.
IF 15G/H is submitted EPF authorities will not deduct tax.
Copy of Form 15G will be sent by EPF to your concerned income tax office and if wrong 15G is given only for avoiding tax then it can create problems with IT.
So submit 15G with care and responsibility.
Holding period for PF is five years in total and not with immediate previous employer only.
Submission of 15G for a PF accumulation of <5 years can avoid TDS,but remember if your whole income from all other sources is above tax limit,you will have to add PF amount to work out tax payable.
If the 5 years rule means PF transfered from previous organisations, I have not transferred from companies B & D. This may be considered as a gap if PF dept. means employers as "immediate previous employer" (they will come to know of the non-transfer from B & D) , otherwise if your reasoning is true then withdrawal is non-taxable
4 months ago, I had applied online for transfer from D to E, but it still shows "in transit between EPFO & office". So since I have left E, will the transfer from D to E still happen or it will be cancelled? D has their own PF managed by a trust & withdrawal will be taxable.
Shall I request for a fresh transfer to my new company?
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