PROVIDENT FUND-COMPARATIVE ANALYSIS

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PROVIDENT FUND-COMPARATIVE ANALYSIS

PROVIDENT FUND-COMPARATIVE ANALYSIS

Particulars Eligibility Employer’s contribution Employee’s contribution Income credited Lump sum payment received at the time of retirement or termination of service or withdrawal
Public Provident Fund (PPF) All Indian residents Employer does not contribute Eligible for deduction u/s 80C Fully exempt Exempt u/s 10(11).
Statutory Provident Fund (SPF) Resident employees Not taxable Eligible for deduction u/s 80C Fully exempt Exempt u/s 10(11).
Recognized Provident Fund (RPF) Resident Employees Not taxable up to 12% of salary Eligible for deduction u/s 80C Exempt up to 8.8% Exempt from tax u/s 10(12).

Note:  Not taxable if employee retires after 5 years of service or inability to work otherwise treated as URPF

Unrecognized Provident Fund (URPF) Resident Employees Not taxable Not eligible for deduction u/s 80C Not taxable at the time of credit. ·        Employee’s contribution exempt from tax and interest thereon is taxable under the head “Income from other sources”

·        Employer’s contribution and interest thereon is taxable as “Profits in lieu of salary” under the head “Income from salary”.

Juhi Ganatra

(Artical Assistant)

Nagpur

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