PF Calculation New Rules: Important news for employed people! The rule related to Provident Fund account has been changed! Now your PF account is divided into two parts. At the same time, the formula for calculating the interest on PF has been prepared. About which you should know! According to the new rule related to PF accounts, the Central Board of Direct Taxes i.e. CBDT (CBDT) has calculated the interest! Interest will be calculated for the financial year 2021-22 on the basis of this new formula.
PF Calculation New Rules
PF Calculation New Rules
The Central Government has issued a notification for change in PF (Provident Fund) account on the basis of new income tax rules. The central government has issued a notification under the new income tax rules saying that depositing more than the prescribed limit in PF accounts will now attract tax. CBDT has notified it! According to this new rule, now PF accounts will be divided into two parts. Let us tell you that the new rule will apply to those who deposit more than Rs 2.5 lakh in PF account.
PF account in two parts: PF Calculation New Rules
The government has issued notification of tax payment on PF (Provident Fund) contribution and interest, after which your PF account will be divided into two parts. People will have to pay income tax from a fixed limit on the interest deposited in PF account. According to the notification, tax will have to be paid on contribution of more than Rs 2.5 lakh. According to the rules, now the PF account will be divided into non-taxable PF contribution and taxable contribution account. Through this rule, the government will keep an eye on those people who earn big money. There are about 1.23 lakh PF subscribers like this!
What is the new rule: PF Calculation New Rules
Under the new rule, the non-taxable PF (Provident Fund) contribution will be the amount remaining till March this year and the contribution made by the individual in 2021-22 and previous years, which is not included in the taxable contribution account and which is within range. The amount deposited in excess of the limit will be in the taxable contribution account and the interest earned on it will be taxed! The new rules will come into effect from April 1 next year.
income tax return
Form 15G is applicable for persons below 60 years of age. And Form 15H is applicable for those aged 60 years or more! TDS is deducted on EPF withdrawal within 5 years of account opening. If PAN card is available with EPFO (Employees’ Provident Fund Organisation), then the TDS deduction rate is 10% if the withdrawal amount exceeds Rs 50,000. However, withdrawals for which PAN card was not available / was linked to PF account. The TDS rate for them was 30%, which has now been reduced to 20%.
Which taxpayers will not be affected
After the implementation of these new rules, most of the PF (Provident Fund) subscribers will benefit from the limit of Rs 2.5 lakh. Although this will not make any difference to the small and middle class taxpayers. This will mostly affect high earning employees. That means if your salary is low or average! So these PF new rules will not make any difference to you!
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