What is Section 192A?
A new section 192A was inserted by the Finance Act, 2015 regarding TDS on payment of accumulated provident fund balance. There are two components of the Employee Provident Fund:
- Employee’s Contribution: Gets Income deduction u/s 80C
- Employer’s Contribution: Exempt up to 12% of Salary.
- Interest on EPF: Exempt upto 9.5% p.a
TDS on EPF withdrawal shall be deductible only if the following conditions are satisfied:
- The amount from EPF has been withdrawn before the completion of continuous 5 years of service, and
- The amount withdrawn is more than INR 50,000.
Rate of TDS u/s 192A
The Deductor is required to deduct TDS @ 10% on withdrawal of EPF. However, if the employee fails to furnish his Permanent Account Number (PAN), then, the Deductor would deduct TDS at the maximum marginal rate.
The Deductor shall deduct TDS at the time of payment of the Accumulated EPF balance due to the employee.
Exemption under Section 192A
There are certain exemptions in which TDS shall not be deducted by the trustees of the Employees’ Provident Fund or any person authorized under the scheme under the following circumstances –
- If the employee has submitted Form 15G/ Form 15H along with the PAN.
- If there is a termination of employment due to the employee’s ill health, completion of the project for which the employee was employed, discontinuation of the employer’s business, or any other reason which is beyond the control of the employee.
- The aggregate amount of EPF withdrawal is less than INR 50,000.
- The withdrawal has been done after a continuous service of 5 years.
- In case of a job change, the PF amount is transferred from one account PF account to another.
TDS Return
The Deductor shall deposit TDS with the Government within 7 days from the end of the month in which TDS is deducted. However, in the case of TDS deducted for the month of March, the same shall be deposited on or before 30th April. In case of TDS deduction u/s 192A deductor shall file a quarterly return in Form 26Q on TRACES within the following due dates :
| Quarter | Due Date for Filing Form 26Q |
| April-June | 31st July |
| July-September | 31st October |
| October-December | 31st January |
| January-March | 31st May |
TDS Certificate
The deductor of the tax shall issue a quarterly TDS certificate to the deductee in form 16A. The deductor can download form 16A from the TRACES Account and also the deductee can see the same in their form 26AS.
FAQs
As per section 206AA, if you do not furnish your Permanent Account Number to the payer (i.e., deductor), then the deductor shall deduct tax at the higher of the following :
1. The Specified rate in the relevant provision of the Act.
2. Rate or rates in force, i.e., the rate prescribed in the Finance Act.
3. At the rate of 20%.
Employee’s contribution gets an income deduction under section 80C. However, if you have withdrawn money from your EPF account, then you are required to report the same under ‘Section 10(12) Recognised Provident Fund’ from the drop-down menu. Furthermore, withdrawal from your PF account will be tax-exempt only if you have completed 5 years of service.
After Budget 2021, interest on an employee’s contribution to an EPF account above INR 2.5 lakh during the financial year is taxable in the hands of the employee. This interest is also subject to TDS.
Hey @Dia_malhotra
As per section 194A, TDS on interest other than interest on securities is required to be deducted by any person other than Individual or HUF at the rate of 10%, when paid to a resident. No surcharge, education cess or SHEC shall be added to the above rate.
Hope this helps!
Hey @HarishMehta
TDS u/s 194J needs to be deducted by deductor other than an individual or a HUF, @ 10% on any amount paid or payable to any which is in excess of INR 30,000 as:
Hope this helps!
Hello @the_AK,
Against gross income, you can claim business expenses that you have incurred for earning that income. So you can claim this service fee as a business expense from the gross income received by you.
Hope this helps!
Hey @Bharti_Vasvani can you please help here?
Hello @Anuj_Agarwal,
TDS will be deducted by the company when the interest is actually paid on the securities, so at that time whoever is the owner of such security shall receive the interest and can claim credit of interest.
Hope this helps!
Hey @Anuj_Agarwal,
You can check out this article for more clarity:
Hope this helps!
I have respectable salary income and 1000 insurance commission…ie old commission…not claiming any expenses…can i show it as other income in itr1 or have to file itr 3
Hi @Shivam_B
If you have income from salary and income from insurance commission (business income), then you will be required to file ITR 3.
Itr 3 is so big…have to pay heavy charges…for filing…will it be defective if i do so ie reporting 1000 as other income in itr1 along with salary income…have closed down the insirance work since yesrs…i even contacted commssiom giving broker and closed my commission account…still they are showing in 26as wheress i am not receiving in real
Hi @Shivam_B
As per the recent utilities, ITD gives you the option to select only the schedules applicable to you while filing ITR.
Thus, you are not required to go through the entire ITR 3 form. You can also prepare and file ITR on Quicko, where you can upload form 16 and add commission income under the head “Business & Profession” and file ITR 3, without any charges as Quicko is a DIY platform helping individuals to file taxes.