InvestorQ : When does my EPF become taxable?
krithika Saxena made post

When does my EPF become taxable?

Answer
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Anisha Awate answered.
6 months ago


Let me explain this with the help of some scenarios:

Scenario 1: You withdraw your entire EPF after 5 years of continuous service.
In this scenario, there’s no tax on the withdrawal. Therefore, the same need not be presented in the income-tax return.

Scenario 2: When you change your job and transfer your PF from one account to another. No TDS is to be deducted. Therefore, it is not to be presented in the return of income.

Scenario 3: PF is withdrawn before the expiry of 5 years. However, the amount withdrawn is less than Rs. 50,000. In this case, there shall be no TDS as even though the amount has been withdrawn before the said period, it is less than the prescribed higher limit for such withdrawal.

Scenario 4: The amount has been withdrawn before termination of 5 years of service or if employment is terminated due to illness, death or reasons for withdrawal are beyond the control of the employee. In this case, also, there shall be no deduction of TDS. In all other cases except above, your PF withdrawal shall be taxable.