EPFO updates Form 13 to Separate Taxable and Non-Taxable PF Components for Accurate Tax Deductions on Interest Earnings
EPFO – Form 13 – Separate Taxable – Non-Taxable PF Components – Accurate Tax Deductions – Interest Earnings – taxscan
EPFO – Form 13 – Separate Taxable – Non-Taxable PF Components – Accurate Tax Deductions – Interest Earnings – taxscan
The EPFO ( Employees' Provident Fund Organisation ) has made the Provident Fund ( PF ) Transfers simpler. The form 13 has brought in a distinct taxable and non-taxable provident fund element for proper tax deductions ( TDS ) on Interest Earnings.
Form 13 now shows the tax as well as the non-tax component of a member's PF funds. The modification will assist in determining TDS on interest income appropriately and will end confusion relating to tax payments both for EPF and members.
The Ministry clarified that PF transfer is not required to be approved by the employer if the employee undergoes any change of job. The EPFO has revised the form 13 on its website. These reforms are set to help more than 1.25 crore members every year and make the transfer of almost₹90,000 crore of PF money every year smoother.
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One of the largest changes is that workers will no longer require employer sanction to shift their PF balance when they switch jobs. Previously, shifting PF involved approvals from both the previous and new employers, which usually resulted in long delays.
Now, from January 2025, when the transfer request is approved by the EPF office in whose account the money is kept, the sum will get credited to the new account of the employee in the destination EPF office without requiring any further authentication. The shift will facilitate more than 1.25 crore members annually and facilitate smoother transfer of close to ₹90,000 crore in PF amounts.
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The updated version of Form 13, published on the EPFO website, is the hub of the better process. It is easier to transfer online, and the process is now more user-friendly and transparent for employees.
Also, for easing of onboarding new employees, EPFO has now made it possible for employers to create Universal Account Numbers (UANs) in bulk even without linking Aadhaar details right away. Nevertheless, these UANs will remain frozen until Aadhaar linking is done, with ease of use being balanced against security.
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