PF Transfer delay resulted in TDS deduction

Dear Sir,

Show it under the head exempt income but be prepared for the notice of mismatch with Form 26AS from the department.

You can opt for option others in ITR-1 and write in the description the facts.

Thanks

Hi,

As per the existing employee provident fund (EPF) regulations, you can withdraw your EPF balance after you remain unemployed for 2 months. If you have contributed to PF for a period exceeding 5 years, the amount you receive upon withdrawal ought to be exempt from tax. As per a recent case law, if there is any delay in seeking the withdrawal of the PF, the interest accruing to you after the period of your service may be taxable, even if you have contributed to PF for a period exceeding 5 years.

Based on above:

1. TCS has already deducted Tax, however based on total income,if there is a short fall in TDS you will have to pay tax.

2. You cannot remove the interest component from your return as doing so shall result in issuance of notice by Income Tax Department.

Hope your queries are resolved.

Hi Kiran

Since no amount has been withdrawn and the same PF account is continued with the new employer, you need not include it in the ITR. It is not a taxable income.

Further, since the income would mismatch with 26AS statement, you may receive a notice for the same. But, on submission of relevant proofs, it shall be accepted. You need not worry.

Hi Kiran,

Hope you are doing well !

It is just a transfer from one company to another company.

It is not a taxable income. You do not need to include in the ITR.

However,you may receive IT notice for the income mismatch with 26AS statement. But if you have a valid documents /proofs, you will get benefit.

Thanks & Regards,

Payal Chhajed

Hi Kiran,

If your PF has been transferred then you dont need to pay any tax on interest earned on PF. Whenever query comes from the department, you can explain this to them

Ideally TCS should not have deducted tds as the transfers of PF usually take sometime and it is the responsibility of the new company and the old company to ensure that the PF of the employee is transferred on time.

Having said that, since the tds has already been deducted, you can adjust in the ITR filing and in case there is a query later you can explain the issue to the Officer.

Also i am assuming in the above advise that there was no intention to withdraw the PF and the same was not done.

Hope that resolves your query.

Regards,

Nikhil.

Hi,

Its not a taxable income so no need to show it in ITR or it can be shown under exempted income.