Epf & gratuity received

I have received EPF and GRATUITY from my employer during the previous FY. Where should I declare this while filing the returns? Please advise.

@Girimon_Vasudevan you must enter the EPF details under section 80C and gratuity details need to be added under schedule salary.

I think you have misunderstood my query. Both these are settlements on retirement. Basically I don’t need to pay tax on these. Nevertheless I was given to understand that these have to be shown during ITR filing.

Hi, Can you please clarify on my query.

Hi @Girimon_Vasudevan

EPF and Gratuity from my employer shall be reported as income under the head salary. There are certain exemptions from tax available to these benefits. Moreover, The employer shall deduct TDS only when this amount exceeds exemption amount under section 10 of Income-tax Act, otherwise, employer shall not deduct any TDS.

You can read more about exemptions from the article below.

That would mean it has to be reported by the employer and not the employee. Correct me if I am wrong.

No. EPF will be remitted by the PF department. They will deduct the TDS if applicable, otherwise, they will remit the full amount to your account. And this amount received has to be reported by you/employee while filing ITR under Salary.

Gratuity will be calculated by the employer and remit to your account. They will deduct TDS if applicable and deposit the TDS to the government which you can claim while filing ITR. But you need to report it in your income while filing ITR.

Both will go under salary income and you can claim exemptions separately similar to how you claim the exemption for HRA. You can check your Form 16; the details of exemption would be given.
For help with ITR filing, you can reach me at sharathtt4@gmail.com

Hi @Girimon_Vasudevan

Employer will report the details with respect to Gratuity in Form 16. You will have to report the details of EPF and Gratuity while filing the ITR under the head salary.

Hey, if you withdraw less than INR 50,000 from your EPF account before the completion of 5 continuous years of service, no TDS will be deducted. However, if the amount is greater than INR 50,000, 10% TDS will be implemented in case Form 15G/15H is not furnished TDS will be deducted if the withdrawal is after 5 years of continuous service.

If TDS is not applicable then it does not mean that the EPF withdrawals are not taxable. If you withdraw your EPF balance before the expiry of five years of continuous service, then it is taxable in the year of withdrawal. In addition to this, your employer’s contributions along with the accumulated interest amount will be taxed as “profits in lieu of salary”. Interest accumulated on your (employee’s) contributions will be taxed under the head “Income from other sources”.

Here’s an article that you might find useful: How to withdraw EPF balance: Step by Step Process.- Learn by Quicko

I left my job in March 2020, can I still contribute to EPF?

Hi Kunal,

No, it isn’t possible to continue contributing to EPF once he/she has left the service. EPF mandates that an employer contributes the same amount as the employee. But since you left service, you cannot be deemed an employee.

However, you can make a contribution towards Public Provident Fund (PPF)

Hope this helps :slight_smile: