Confused About PF Withdrawal Deductions? Seeking Clarity on Company Policy

Dear Seniors,

Kindly guide me. My company is saying that my PF withdrawal will attract a 25-30% deduction. I heard from my Separation Officer that it should be a maximum of 10%. Please help me out.

Thanks,

Hi,

What deduction are you talking about? Please specify. Since there is no deduction that takes place from the withdrawal amount. Or does your company have its own PF Fund?

Regards,
Harshad

Mr. Harshad,

My company says that there may be a deduction of 25-30% on the withdrawal from my EPF Account. The account number reads MH/BAN/.../.... I am not sure if they have a PF Fund. Could the laws of EPF be altered if an organization has its own PF Fund? I am concerned about whether the deduction is legal or not.

Hi,

What deduction is that? Have they specified on what account the deduction will be? There is no tax applicable on withdrawal as of now. So, what's the ded?

Regards,
Harshad

The mail reads as follows:

Dear XYZ,

Please note that tax of around 25-30% will be deducted on your PF withdrawal. Therefore, I kindly request you to transfer your PF to your current organization.

If you have any further clarifications, please feel free to email us or call us at the number provided below.

Thanks & Regards,

PS:

I do not have any current employment, so the question of transferring the PF is not applicable.

If you obtained any advance from PF, then only it will be deducted from your settlement; otherwise, nothing can be deducted from anybody. Normally, the PF deducted amount is also exempt from income tax. How is it possible to deduct tax amount?

Regards,
Thiru :-P

PF funds, if managed by the Regional PF Commissioner, do not attract any tax. But if you have a separate PF Trust, then TDS is applicable as per your TDS slab. If PF is withdrawn within 6 months from the PF office, then the Pension Fund will not be paid.

Regards,
Anish

Why is there discrimination between PF Trust and RPF? We do not get any benefit for keeping our money with the PF Trust, so why should we be penalized when withdrawing this amount.