PF Account: The general budget of the country has been presented by Finance Minister Nirmala Sitharaman on 1 February. Many big announcements have been made in this budget by the Finance Minister.
Along with this, an important announcement has also been made regarding Provident Fund (PF) in the budget. This announcement is going to benefit those people, who are about to withdraw from PF account.
TDS Rule: Many important announcements have been made by the Modi government in Budget 2023. Through these announcements, announcements have been made by the government keeping in mind the interests of different classes of people. Along with this, an important announcement has been made by the Modi government regarding PF in this budget. Crores of people are also going to get benefit through this announcement.
Budget 2023
The general budget of the country has been presented by Finance Minister Nirmala Sitharaman on 1 February. Many big announcements have been made in this budget by the Finance Minister. Along with this, an important announcement has also been made regarding Provident Fund (PF) in the budget. This announcement is going to benefit those people, who are about to withdraw from PF account.
TDS Rate
According to the budget speech of Finance Minister Nirmala Sitharaman, earlier TDS of 30 per cent had to be paid on withdrawal from EPF. However, now a proposal has been made by the government to reduce it. Now 20 percent TDS has been proposed by the government on EPF withdrawal. In such a situation, now people will have to pay only 20 percent TDS on withdrawing money from EPF.
PF Withdrawal
People are going to get a lot of benefit by cutting TDS on withdrawal from EPF. The reduction in TDS rate on EPF withdrawal will help those individuals whose PAN number is not updated with the records in EPFO. At the same time, the requirement of tax deduction at the maximum marginal rate on PF withdrawal for non-PAN holders has been removed to provide some relief to income earners in low income slabs. Such persons will now be subject to TDS at 20%. At the same time, the new rule will be applicable from 1 April 2023.
EPF
As per the current income tax laws, TDS is deducted on EPF withdrawal if the money is withdrawn within 5 years of opening the EPF account. If PAN is available with EPFO, TDS is deducted at the rate of 10% if the withdrawal amount exceeds Rs.50,000. However, if PAN is not available, TDS is deducted at 30%.
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