Is EPF Withdrawal Taxable

POSTED BY Sumanth ON August 7, 2013 9:05 pm COMMENTS (3)

Hi,

I am planning to close one of my EPF Account, I have completed 5 years of service with the employer, moving to another employer, so if i close my EPF of the first Employer where i have completed 5yrs of service is the amount taxable or not.

If taxable please let me know how is the tax calculated.

3 replies on this article “Is EPF Withdrawal Taxable”

  1. BanyanFA says:

    Sumanth,
    If you are going to be employed in future, I would strongly recommend you not to encash you PF but transfer it to your new employer every time you change the jobs. I can appreciate the pains of dealing with EPF authorities, but you generally don’t have to do so on an ongoing basis. No other debt investment can be better positioned than PF. Check out my article http://insight.banyanfa.com/making-ppf/ and the discussion on it.

  2. Sumanth says:

    Dear Ashal,

    Thanks a lot for the reply. I am planning to close because earlier i have tried to transfer one of the account from one company to another, even after 1.3 yrs it was not complete, and when finally i have raised a grievance they have taken close to 2 months to reply and on top of that i had to go personally to the EPFO office and collect the rejection letter in person and finally decided to close the account and submitted the documents for closure and to my surprise i have received the money in just 2 to 3 weeks.

    so this time i thought of closing the account any suggestions

    Thanks,
    Sumanth

  3. Dear Sumanth, it’s not at all taxable. why are you not opting for transfer?

    thanks

    Ashal

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