I worked at Genpact for 4 years and 6 months. I then joined another company and did not transfer my PF. My overall experience as of now is 5 years and 3 months. I have a few queries:
1) If I want to withdraw my PF from the old company, how much tax will be deducted? Will my overall experience be counted, or just the 4 years and 6 months when withdrawing?
2) Can I transfer it to the new company and then withdraw from the new company? Will it count my experience as more than 5 years when I transfer? Is there a way where I can avoid tax on this? Because PF+VPF is one kind of saving, and when I withdraw, if it is taxable, then it is of no use.
3) How much percentage of our PF amount can be withdrawn from the current company if it is for house purchase purpose?
Thanks,
Vinnu
From India
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1) If I want to withdraw my PF from the old company, how much tax will be deducted? Will my overall experience be counted, or just the 4 years and 6 months when withdrawing?
2) Can I transfer it to the new company and then withdraw from the new company? Will it count my experience as more than 5 years when I transfer? Is there a way where I can avoid tax on this? Because PF+VPF is one kind of saving, and when I withdraw, if it is taxable, then it is of no use.
3) How much percentage of our PF amount can be withdrawn from the current company if it is for house purchase purpose?
Thanks,
Vinnu
From India
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Dear Vinnu,
The PF amount is non-taxable; however, there is a slab up to a limit where one gets a tax benefit when it is withdrawn, similar to the contribution to VPF. Please confirm the same from the current status from the Finance department or PF office.
You can transfer the PF amount to the new account (company). In case of transfer, your service for pension purposes will be counted from your previous date of joining.
For a house loan, you can withdraw 50% of your share, and your service must be at least five years old. There are several formalities to consider.
Manish Kumar
From India, Lucknow
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The PF amount is non-taxable; however, there is a slab up to a limit where one gets a tax benefit when it is withdrawn, similar to the contribution to VPF. Please confirm the same from the current status from the Finance department or PF office.
You can transfer the PF amount to the new account (company). In case of transfer, your service for pension purposes will be counted from your previous date of joining.
For a house loan, you can withdraw 50% of your share, and your service must be at least five years old. There are several formalities to consider.
Manish Kumar
From India, Lucknow
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Tax on premature PF withdrawal.pdf
Employee Benefits.doc