The limit of Rs. 50,000 for submitting Form 15G pertains to the total amount withdrawn from the Employees' Provident Fund (EPF) account, which includes both the PF and pension fund components. When an individual submits Form 15G, they are declaring that their total income is below the taxable limit, and hence, no tax should be deducted at source on the EPF withdrawal. Here's a breakdown of how this applies:
Explanation:
- The EPF withdrawal consists of both the PF and pension fund balances.
- If the total amount withdrawn, including both PF and pension fund, is below Rs. 50,000, then Form 15G can be submitted to avoid TDS deduction.
- It's essential to consider the cumulative amount from both the PF and pension fund while determining if it falls below the Rs. 50,000 threshold.
Practical Steps:
1. Calculate the total amount you intend to withdraw from both the PF and pension fund.
2. Ensure that the total amount does not exceed Rs. 50,000 to be eligible for submitting Form 15G.
3. If the total amount is below the threshold, fill out Form 15G accurately and submit it to the concerned authority.
4. Keep a copy of the submitted Form 15G for your records.
By understanding the combined value of the PF and pension fund withdrawals, individuals can determine their eligibility to submit Form 15G effectively to avoid TDS deduction on EPF withdrawals.