I got a job in the year 2019 and noticed that a small amount of money gets deducted from my salary as Provident Fund. I was not much aware of this at that time so asked my father vividly about it. He said that PF is like a security fund where both the employee and employer or the company contributes so that the employee can lead a good life with the amount saved throughout his working life after retirement. My next question was, what is Statutory Provident Fund meaning to which he said that it is another name of the General Provident Fund and is intended for the government employees, educational institutions that are accredited, railways and more but the employees in the private sector are not covered by this fund.
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What is Statutory Provident Fund in Income Tax ?
As per income tax, the contributions made by the employee might come under Section 80c. Interest amount that gets added during the financial year is not considered as income and thus it is exempted from income tax.
Also know that the employer's contribution is not taxable but the employee's contribution is taxable.
Can one withdraw the PF amount after leaving the job?I got very curious about it and asked my father whether I can withdraw it anytime I want or not to which he said NO. One has to wait 5 years to withdraw the amount or has to pay tax on the saved amount on his bank.
I hope the Statutory Provident Fund meaning is clear to you as well now.
Read More:What is 80CCC in Income Tax?
What is Section 80C on Income Tax?
What is Employee Provident Fund?
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Authors Of The Question
What Is Statutory Provident Fund?
Tiyasha
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2 Year
2022-08-17T09:38:41+00:00 2022-08-17T09:38:42+00:00Comment
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