Finance Minister, Arun Jaitley today said that the proposal to tax the Employees Provident Fund which was proposed in the Union Budget 2016-17, now stands withdrawn.
Click to Download the Automated All in One TDS on Salary for All State Employees for F.Y.2016-17 & Assessment Year 2017-18with all amended by the Finance Budget 2016.
In his Union Budget 2016-17 recommendations, the Finance Minister had proposed that after April 1, 2016, 60 per cent of the amount deposited in the Employees Provident Fund would be taxable at the time of withdrawal, while 40 per cent will be tax free. Earlier, the entire EPF deposit was tax-free at the time of withdrawal if the employee has completed five years of continuous service. The withdrawal of the proposal would bring relief to at least 60 lakh subscribers of the EPF. There has been confusion and also resentment towards the proposal. Earlier, there was some clarification that it would not be taxable, if 60 per cent of the amount would be invested in pensions funds. There were also some reports that only the interest component would be taxed. The withdrawal now is a big relief to subscribers.
