Confused About My PF Amount and Tax Deduction After Leaving an NGO – Can Anyone Explain?

Dear friends, I was working for an NGO and recently quit after working for 4.5 years. Now, when I received a statement from them, it states that my PF accumulation to date is only 50K. However, some of my colleagues who worked there only for 2 years received a PF of about 90K. I am not able to understand the logic behind how they calculate PF. Additionally, they told me that if I withdraw the PF before completing 5 years of service, there will be a deduction of 30% tax on the entire PF. Is this correct? Please clarify.

Hi, do you know your basic salary? If yes, then take 12% of your basic salary plus 12% from your company. Then multiply it by the number of working months. You will get the total amount, but in that, 24% of it will be interest on 15.67% of the amount only.

If the salaries are the same, the difference may be due to voluntary contributions by your colleagues.

Abbas.P.S

Please collect Form-23, i.e., PF pay slips. In them, they will mention the opening balance, current year balance, as well as the closing balance at the end of the year. Maybe it will help you.

I fully agree with Shri Abbasiti. The difference may be on account of voluntary subscription to the PF for saving income tax.

Taxability of Withdrawal Before Completion of 5-Year Service

If self-subscription to one's PF account is withdrawn, no income tax is leviable irrespective of the length of service as it is already taxed at source. The employer contribution to one's PF is not taxable if the length of service is more than 5 years. In the case of less than 5 years of service, the employer contribution is taxable income. The income tax is not to be deducted at source. The assessee has to declare it in his return and pay the due tax on it. If he evades it, he/she is a defaulter and guilty of false declaration.

Some people misinterpret the condition of 5-year service. Even if the length of service is less than 5 years, they apply for withdrawal late—after 5 years. Even if the account is closed late and the accumulations withdrawn after completion of 5 years, that does not change the tenure of service. To be specific—a person works for 4 years and nine months and leaves his job. He does not apply for PF withdrawal immediately after leaving the job. He waits for a year and then applies for withdrawal. He will get interest for the period his amount lies in the PF account, but despite his getting the PF dues after six years, his employer contribution is still taxable because he had left the job after 4 years and nine months. His late application for payment of PF dues does not increase his length of service.

We are not receiving our PF statement on a yearly basis. I have been working with this company for 6 years and have not received a single statement. Can anyone please tell me what should be done so that I know my current PF balance? I have also read that the PF basic calculation should be 7500 instead of 6500?

[QUOTE v.srinivasmba;1447955]
Dear friends,

I was working for an NGO and recently quit after working for 4.5 years. Now, when I received a statement from them, it states that my PF accumulation to date is only 50K. However, some of my colleagues who worked there for only 2 years got a PF of about 90K. I am not able to understand the logic behind how they calculate PF. They also told me that if I withdraw the PF before completing 5 years of service, there will be a deduction of 30% tax on the entire PF. Is this correct? Please clarify
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