Employee Provident Fund Withdrawals Simplified

SBA

Were you thinking of withdrawing your Employee Provident Fund? There’s good news for you. The Employee Provident Fund Organization (EPFO) has recently announced a simplified process for the withdrawal of EPF. Now you need not worry about getting the forms attested by your employer. The new process is simpler, faster and more secure. Read on to learn all about it. We’ll take you through the process, one step at a time.

What’s New?

The EPFO has introduced a revised set of forms to facilitate smooth, hassle-free EPF withdrawals.

Did you find the old process that required the employer’s verification and attestation very cumbersome? Not anymore. As a result of the new changes, the withdrawal process will be much faster because now you do not need to get the withdrawal forms attested by your employer.

Read more about the new EPFO Guidelines.

The EPFO has introduced three new forms.

• Form 19 UAN – At the time of retirement, or when you leave a job, you can use this form to withdraw your Employee Provident Fund. Remember, withdrawing money from the Employee Provident Fund is permitted only if you are unemployed for a period of 2 months.
• Form 10-C UAN – This form can be used to withdraw money from your EPS account. The EPS account is a separate account that is linked to your Employee Provident Fund. This EPS account covers your pension. You are allowed to make a withdrawal from the EPS account only if your EPF account is less than 10 years old.
• Form 31 UAN – You can submit this form if you wish to make a partial withdrawal from your EPF account. A partial withdrawal can be made for marriage, medical emergencies or if you plan to buy a house.

Who Can Use the New EPF Forms?

Did you think everyone can use the new EPF forms? The new EPF forms can be used only by those employees who fulfil the following two conditions.

• Your Universal Account Number (UAN) must be linked with your Aadhar number.
• Your KYC details and bank account number should be verified by your employer using a digital signature.

Got a New Job?

If you just got a new job and want to withdraw your Employee Provident Fund, you cannot make a withdrawal. What do you do then, you ask? Apply for a transfer of your EPF.

A Guide to Withdrawing Money from your Employee Provident Fund Account

We’ll walk you through the process of withdrawing money from your EPF account.

1. Ensure your UAN is Active & KYC Information is verified. You must first make sure your UAN is active and all your KYC information is verified by your employer. Login to verify that you are eligible to use the new forms. Review your KYC details under Profile > Update KYC Information. 

If you have more than one UAN assigned to you, use the one given to you by your present employer. 

2. Fill the EPF Withdrawal Form. On verification of your UAN status and KYC information, complete the EPF Withdrawal forms.

You will need to provide the following information:

• Your mobile number
• UAN number
• Date of leaving
• Reason for leaving service
• PAN number & complete postal address

Remember to attach a cancelled cheque of the bank account mentioned in your KYC information.

3. Send the form to the EPF Jurisdiction Office. Now all you need to do is submit the completed form by courier to the EPF office that falls under your jurisdiction. Locate the address of the regional EPF office.

Want to withdraw your entire EPF amount?

If you want to withdraw your entire EPF amount, you need to complete Form 19 UAN & Form 10-C UAN and send them both to the EPF office.

Source: Bank Bazaar.com

Regards

Shri Balaji Associates

Money Transfer to Spouse ! Gift Or Loan ??

Can you save tax by transferring money to wife's account?

Do you transfer money to your spouse’s account so he/she can meet personal expenses, does that money earn an income. Or do you consider it loaned. Let’s understand today, how the income from such transfer is treated from income tax standpoint.

How gifts are taxed in India

Money is Invested in Shares or Fixed Deposits or other Assets– The shares may have been purchased in your wife’s name or fixed deposits made in her account – but the income from such fixed deposits or gains from the wife’s shares transactions shall be clubbed with your income. As per clubbing provisions of Income Tax, this is considered as your own income and taxed at slab rates applicable to you. Even if there are capital losses from sale, those get added too.

Money is considered Loaned – There could be a situation where you have genuinely transferred money to your wife’s account to meet her financial needs, for e.g. to help her start a business. The amount is considers loaned and is planned to be returned and interest is charged as well. In case you are charging a reasonable interest and also showing the interest as your income in your return, income earned by your wife may not be clubbed. However, in cases where amount is shown as loaned to your wife and she is investing that money in shares to earn an income, and thereby you end up saving significant tax by avoiding clubbing of income (gains) on shares, it may be hard to convince the tax authorities about the lender borrower arrangement, given the close relationship of the parties and the tax save involved. Usually in most cases - it's misused as a tax saving avenue and that is what the tax authorities want to be careful of.

Only to meet Personal Expenses – When one of a couple is a home keeper and is not earning an income, it is commonplace this person receives some money to take care of personal expenses. This has no income tax implication and is not considered an income in the receiver’s hands. However, any interest earned in the bank account may still be clubbed.

Source: Yahoo.com

Regards

SHRI BALAJI ASSOCIATES

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All About Public Provident Fund (PPF A/c)

Looking to invest for the long term? Here’s an investment option that gives you twice as much. How, you ask? The Public Provident Fund Scheme is a safe, Government scheme that allows you to build retirement savings, and also gives you great tax benefits. So, if you haven’t yet opened your PPF account, read on to find out why it’s a good idea.

What is a Public Provident Fund?

A Public Provident Fund is a long-term investment option introduced by the Government of India. The scheme is risk-free and offers attractive interest rates. What’s more, the returns are fully exempted from tax.

More about the Public Provident Fund

The Public Provident Fund was established by the Government to provide retirement security to employed and self-employed individuals in the country.

Tenure

The lock-in period for a Public Provident Fund account is 15 years. Your PPF account will mature after a period of 15 years from the end of the year in which the account was opened.

Extending the Tenure

On the maturity of your PPF account, you can extend the tenure any number of times, for a period of 5 years each time.

If you choose to extend the tenure of your PPF account, this must be done within 12 months from the date of maturity.

Premature Closure

You cannot close a PPF account before the initial lock-in period of 15 years. In the event of your death, your nominees/legal heirs can close the account after submitting the required documents.

How Many PPF Accounts is Too Many?

• You are allowed to operate only one PPF account in your name.
• You can open a PPF account in the name of a minor child if you are the parent/guardian.

 Make deposits at your convenience

• You can open a PPF account with an initial deposit of as little as Rs. 100.
• A minimum annual deposit of Rs. 500 is necessary to keep your PPF account active.
• A maximum deposit of Rs. 1, 50,000 can be made in your PPF account in a financial year.
• If you invest more than Rs. 1, 50,000 in a PPF account in a financial year, you may not be eligible for the interest on the excess amount.
• You can make deposits to your PPF account on a monthly basis or at your convenience. A maximum of 12 deposits can be made in a year.

Rate of Interest on your PPF Account

The rate of interest on a PPF account is fixed on an annual basis.

The current rate of interest (up to March 2015) is 8.70%.

Remember that interest on your PPF account is calculated on the minimum balance in your account between the 5^th and the last day of every month.

The interest is compounded annually and credited on 31 March every year.

Eligibility to open a PPF Account

All Indian residents are eligible to open a PPF account.

Non-resident Indians are not eligible to open a PPF account. However, if an individual opened a PPF account when they were resident in India, but became NRI during the tenure of the PPF account, such individuals will be eligible to continue investing in the PPF account until the maturity.

The funds held in such accounts will not be transferred overseas, but will need to be used only in India.

Withdrawals from PPF Accounts

You can make one withdrawal per year starting from the seventh year. Your first withdrawal can be made after the completion of 5 financial years from the end of the year in which you made your first deposit and opened your account.

How Much You Can Withdraw

You can withdraw an amount up to 50% of the balance in your account at the end of the fourth year.

What to do if your PPF account is deactivated

If you do not deposit the minimum amount of Rs. 500 in a financial year, your PPF account will be marked as a deactivated account.

To re-activate your PPF account, you will need to pay a penalty of Rs. 50 for each year that you have not made any deposits.

You will also need to make a minimum deposit of Rs. 500 for each year that you have missed.

 Loans from PPF Accounts

You can take a loan from your PPF account up to a maximum limit of 25% of the balance in your PPF account at the end of the second year.

Eligibility for Loan from PPF Account

You will be eligible to avail the loan facility from your PPF account between the third financial year to the sixth financial year – up to the end of the fifth financial year.

Loan Repayment

The repayment of the loan from the PPF account has to be made in one lump sum or in two or more instalments within a period of 36 months.

After the repayment of the principal amount, you will need to pay the interest amount within a maximum of two monthly instalments.

Interest Rates for Loans from PPF Accounts

The interest rate on loans from your PPF account is 2% on the principal amount.

Save Tax with a PPF Account

A PPF account is a good tax-saving investment option because deposits up to Rs. 1,50,000 p.a. in your PPF account are deductible under Section 80C of the Income Tax Act.

The interest accrued on the full balance in your PPF account is entirely exempt from tax.

The balance in your PPF account cannot be attached to any claim in case you have debts or liabilities.

Where you can open a PPF Account  

If you think you’re ready to open a PPF account, here are the places you can do that:

• Branches of State Bank of India
• Select Post Offices across India
• Select branches of designated nationalised banks

Documents Required

You need the following documents to open a PPF account.

• Account Opening Form – Form A
• Copy of your PAN Card
• Residence Proof – Electricity Bill/Passport
• Passport-size photograph

So if you’re in it for the long term, and if you’re ready to block your funds for a long tenure, a PPF account is your answer.

Regards

Shri Balaji Associates

Advance Income Tax

PAY YOUR ADVANCE INCOME TAX ON OR BEFORE 15TH DECEMBER 2015 !

• 3rd Installment for Companies
• and 2nd for Other Tax Payers

HURRY ! And Contribute yourself for your country 

Regards

Shri Balaji Associates

About

About Shri Balaji Associates

HELLO THERE!

Let us introduce ourselves we “Shri Balaji Associates” THE Associates engaged in providing of professional services to clients i.e. Tax Planning, Tax Consulting, etc. Further we provide professional services related to

Income tax (Tax audit, Statutory audit, ITR, Pan Card, Book writing, Income tax refund, Firm registration, reply of notices, etc ), 

Sales tax (TIN No., Sales tax return, C-Form, any other form, Cancel the registration, any amendment, Case preparation, any appeal, any assessment, any refund) 

Service tax (Service tax registration, service tax return), 

TDS (TDS No, TDS Return, Issue of certificate of foreign remittance), 

ROC (Incorporation of Company, e-filing forms 20B, 23AC & 23ACA, form 66, and various other forms, etc.) 

Finance (Preparation of document for taking loan, projected & provisional balance sheets, CMA Data, Stock statement), 

Certification (Issue of 15CB/15CA, Solvency Certificate, any other types of certificates),any donation, Import Export Code,etc. 

    

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