The government on Monday notified that it has raised the threshold limit of PF withdrawals for deduction of tax (TDS) from existing Rs 30,000 to Rs 50,000, a senior official told PTI.
"The Finance Act, 2016 has amended section 192A of Income Tax Act, 1961 to raise the threshold limit of PF withdrawal from Rs.30,000 to Rs.50,000 for Tax Deducted at Source (TDS)," the notification stated.
The above rule will be applicable from June 1, 2016.
Earlier, if employee withdraws amount more than or equal to Rs 30000, with service less than 5 years, then TDS will be deducted at 10% if Form-15G/15H is not submitted provided PAN is submitted.
TDS will be deducted at maximum marginal rate (i:e. 34.608%) if employee fails to submit PAN.