PF account holder: Employees Provident Fund Organization has revised Form No. 13 for its members. In which the process of transferring Provident Fund Account from one company to another will be extremely easy for a person who leaves one company and join another company. Due to this form amended by the Employees Provident Fund Office, the taxable interest part and non-taxable interest part of the provident fund can be seen separately. Now, the Employees Provident Fund Office (EPFO) will also help company owners to create universal accounts for several employees simultaneously. For this, you will not have to add your Aadhaar card separately. Thus the whole process will become very easy. This new system will benefit about 1.25 crore provident fund account holders of the country.
Provident fund account transfer process became easy
By filling the form number 13, the salaried employee will be able to transfer his provident fund from one company to another on changing the job. In the old system, employees had to take approval from both old and new companies for transfer of provident fund. Filling Form 13 will automatically transfer the provident fund deposited in the old company to the new company.
Now, how much interest in the interest amount given on the amount deposited in the Provident Fund account and how non-taxable is also depicted separately. As a result, it will be easier to pay tax liabilities for the account holder. As a result of this system, it will also be easier to calculate how much TDS has to be given on the interest amount. Sources in the Employees Provident Fund Office say that this arrangement is to ensure that there is no mistake while filing tax returns in future.
Along with this, the process of disposal of provident fund account has also been intensified. This will greatly benefit those who want to settle their provident fund account quickly after retirement and to withdraw the amount of provident fund to their account.
By filling the new form 13, integrated account numbers of many employees can also be generated in bulk. Provident fund members, especially the exempted provident funds, will have to join the EPFO or else the exemption will be withdrawn. Also, there will be an option to join EPFO or avail tax exemption even in cases stuck in semi-judicial legal process. Based on the data and details of the employees working in the company, the integrated account number of several employees can be prepared simultaneously. For this, you will not need to give your Aadhaar card immediately. However, the integrated account number will be kept freeze until the Aadhaar card seeding or uploading is completed.
Which interest received from provident fund will be considered taxable?
• After completing the pay amount on the salary amount, no tax will be levied on the interest income earned on the amount deposited in the provident fund.
• If the company owner deposits 12 percent of salary income as contribution to the provident fund, then interest income will not be taxable on that amount.
• If the contribution made by the owner of the company to the provident fund during the year is more than Rs 2.5 lakh, then the interest earned on that additional amount will be taxable.
• If the share of the owner of the company is not deposited in the provident fund, then in such a situation, if the annual interest income is more than Rs 5 lakh, then income tax is levied on that additional interest income. Under the new rules implemented in the year 2021-22, the interest deposited more than Rs 5 lakh per year in provident fund accounts under income tax.
• If the amount of provident fund is withdrawn after five years of job, then the entire amount of that provident fund is considered tax-free.
• If the amount deposited in the provident fund account is withdrawn before five years, the contribution made by the company owner and the interest earned on it is subject to income tax. In such cases the benefits received under Section 80C of the Income Tax Act will also be withdrawn and the amount deposited by the company owner and the interest earned on it will be subject to it.
