To avoid tax deduction at source, individuals can now submit Form 15G for EPF Withdrawal online via the Unified Member Portal. Here in this article, we will take you through the process.
In May 2019, EPF Member Website for employees allowed for the submission of form 15G for EPF Withdrawal online to avoid Tax Deduction at Source. Now, you can submit form 15G for EPF Withdrawal online via the Unified Member Portal. You must be knowing that if you wish to withdraw EPF before five years of EPF contribution, then TDS will be applicable to the EPF Withdrawal amount. As an exclusion, if your total income is less than the taxable limit, you can submit form 15G as self-declaration to stop TDS deduction.
So, if you are planning to withdraw your EPF online through the Unified Member Portal, you have landed on the right place to gain a thorough knowledge of the concept.
Before going on further, here is brief information to recall what EPF refers to?
EPF stands for Employees’ Provident Fund. EPF is a fund created to accumulate funds contributed by the employee as well as the employer. The main aim of this fund contribution is to provide financial protection to the employee after his retirement. The amount that employees invest throughout their work tenure, along with interest accumulated, is paid back to the employee in the event of his retirement.
The fact is EPF not just only provides you a safety cover after retirement but also supports you financially during your employment years.
Submit Form 15G for EPF Withdrawal Online (2020)
Now, let’s have a look at the concept of form 15G and TDS rule on EPF Withdrawal.
Form 15G, 15H and TDS Rule on EPF Withdrawal
Form 15G and 15H
Form 15G and Form 15H are self – declaration forms submitted to the concerned authorities to stop the TDS deduction for the particular income. Such forms can be used for receiving different payments like interest received on bank fixed deposits, commission on insurance, rental income, and Employee Provident Fund Withdrawal.
Difference between Form 15G and 15F
The difference between form 15G and 15F is explained below:
Form 15G is to be submitted by the individuals, who are residents of India, and who are below the age of 60 years, who have a nil amount of taxable income. The maximum limit specified for the financial year 2019-20 is Rs 2,50,000. The same form is there for HUFs.
Form 15H is to be submitted by a Senior citizen, who should be a resident of India, and who is above the age of 60 years. For this, he must satisfy the income tax criteria.
- The extreme limit in the financial year 2019-20, permitted for the Senior citizens, is Rs 3,00,000. For those Senior citizens who are above the age of 80 years, the tax exemption limit is Rs 5,00,000.
- Along with this, the exemption limit from tax for the Senior citizens on interest on Bank fixed deposits and Post office deposits is revised from Rs 10,000 in FY 2018-19 to Rs 50,000 in FY 2019-20.
EPF is allowed to be withdrawn fully or partially under certain conditions. According to the rule, an individual can withdraw full EPF amount in two conditions; First is when he/she takes retirement from his/her work, and second is, when an individual remains unemployed up to 2 months after resigning or being terminated from his/ her job, he/she is allowed to withdraw the entire EPF amount.
Whereas, partial EPF Withdrawal is also permitted under some situations like education, marriage, construction of a house, renovation of the house, repayment of home loan, and for medical reasons.
Tax Deduction at Source or TDS Rule on EPF Withdrawal
1. TDS or tax is not applicable for a deduction if you withdraw your EPF after 5 years of service or work tenure.
Here, 5 years refers to 5 years of contribution towards EPF. It can be in multiple companies and can have break periods in between. For example, You have worked in a company for 3 years, and then you joined a new company and transferred your EPF from the former employer to the new employer. Now, you have to work at least 2 years more, then the total number of your working years will be 5 years.
TDS is imposed on Provident Fund or EPF withdrawal before completion of 5 years of work tenure, as per the rules discussed below:
2. Tax deduction at source is applicable for a deduction if the withdrawal amount is more than Rs. 50,000 (before June 2016, this limit was Rs 30,000).
3. TDS is deducted at the rate of 10% if PAN ( Permanent Account Number) is furnished, whereas if PAN is not furnished, then TDS is deducted at the rate of 34.608%.
4. If you opt for offline EPF withdrawal, you can submit Form 15G or 15H to avoid TDS, but now you can submit it online as well.
5. There are four constituents of EPF:
- Employee’s share of contribution
- Employer’s share of contribution
- Interest received on employee’s contribution
- Interest received on the employer’s contribution
The tax is imposed only on the employer’s contribution and interest. The employee’s contribution and interest received don’t come under taxation. The employer’s contribution will be classified under the head ‘Salary’ and the Interest constituent under ‘Income from other sources.’ Though, relief is available under section 89 of the Income Tax Act, 1961.
How to Submit form 15G for Provident fund or EPF Withdrawal Online
To submit form 15G for EPF Withdrawal online, you should follow the steps stated below:
- First of all, log in to the unified member portal – EPFO UAN Portal. You have to use the UAN number and password for login.
- Now, from the top menu bar, click on the Online services > Claim (32, 19, 10C)
- You can now see your profile information, such as your Name, Date of Birth, mobile number, PAN number, etc.
- You are required to enter the last four digits of your account number in order to verify your bank account.
- The portal will pop up a notification, regarding verification of your bank account, showing that the claim amount will be credited to the bank account provided.
- Now, click on ‘proceed for the online claim.’ On the next page, you have to select the claim option. By default, you will see the ‘PF – Advance FORM 31’ option.
- Hereby, if you have resigned from your job and your EPF account is marked with the reason for terminating the job, you can see the option of ‘Only PF Withdrawal Form 19’, against the head of ‘I want to apply for.’
- Below the head ‘I want to apply for,’ you will find the option to Upload Form 15G.
How to fill Form 15G for Provident Fund Withdrawal
To fill form 15G as self-declaration to avoid TDS on EPF withdrawal, you should follow these steps:
- After downloading form 15G, must remember you have to fill Part 1 of form 15G, fill that only, you are not required to fill Part 2 of the form.
- In Part 1, you are required to fill up the relevant details your Name as per PAN, PAN number, Status, Previous year, Residential status, and Address.
- Along with this, you are required to state your estimated income for which this declaration is made and your estimated total income. You can get your estimated Provident fund income from your EPF passbook.
- You are also required to show the nature of income and the section under which tax is deductible on such income.
- Once you have provided all the necessary details, you are required to sign form 15G.
- You have to upload this filled form 15G on the online portal, as per the steps mentioned in the previous section regarding form submission.
By adhering to these steps, you can successfully submit the form. The EPF withdrawal usually takes time of 5 to 30 days after applying for the withdrawal online. However, you can keep track of your EPF Withdrawal claim status online from the unified portal. You have to click on the Online service > Track claim status; to know the status of your withdrawal claim.
In case you find any sort of difficulty in applying for the online EPF Withdrawal, you can get in contact with the helpdesk on the number 1800 11 8005. Apart from this, you can also mail your query to ’[email protected]’
Form 15G or 15H are self-declaration forms, which are submitted by an individual to enunciate that their income is below the taxable limit; therefore, TDS should not be deducted from their income. It is now submitted online at the time of EPF Withdrawal. The final taxation amount on the estimated total income shall be calculated with respect to the provisions of the Income Tax Act, 1961.
Also Read: Income Tax Slab for FY 2020-21 (AY 2021-22)
However, to apply for this form, an individual must fulfill certain conditions, as described in the act. If a person satisfies the conditions required, then he/she should definitely submit form 15G to escape from the TDS deduction from your income to retain much of your earnings. The procedure to submit the form doesn’t require tiresome efforts. By following the process mentioned step by step, you can easily apply for your EPF Withdrawal online along with form 15G.