Chennai: A new provision introduced in the finance Act this year allows for income tax deduction at source (TDS) at the time of payment of provident fund (PF) in Form 19, if at the “time of payment, accumulated PF balance is more than or equal to Rs 30,000 with service less than five years if PAN number is provided”. The new provision took effect from June 1, says an official release on Thursday from the regional PF commissioner.
While the TDS would be at the rate of 10 per cent, in case the PAN number is not submitted by the PF member, then the TDS will be deducted at maximum marginal rate, namely, 34.608 per cent, the release said. However, TDS will not be deducted in the following cases:
a) Member who had rendered continuous service of five years or more, including service with former employer shall not be required to submit PAN and Form 15G/15H along with Form 19.
b) Member whose service has been terminated due to ill-health, contraction or discontinuance of business of employer or other causes beyond the control of the member, shall not be required to submit PAN, Form no. 15G/15H along with Form 19.
c) TDS shall not be deducted in case of transfer of PF from one establishment to another.
d) If payment is less than '30,000 and the service is less than five years then no TDS is deductible.
e) If payment is greater than or equal to Rs30,000 and service less than five years and submits Form 15G/15H along with their PAN.
Subscribers are also advised to submit copy of their PAN card along with signed Form 15G/H for speedy settlement of claims.
