Zee Media Bureau
New Delhi: In a shocker for over 5 crore provident fund account holders and salaried class, withdrawal of EPF and superannuation corpus will now be taxable.
Budget 2016, announced by Finance Minister Arun Jaitley on Monday proposes to tax part of Employee Provident Fund (EPF) withdrawals from April 1, 2016.
Those withdrawals over 60 percent of EPF will be eligible for tax while the remaining 40 percent will be tax free.
"In case of superannuation funds and recognized provident funds, including EPF, the same norm of 40 percent of corpus to be tax free will apply in respect of corpus created out of contributions made on or from 1.4.2016," said Finance Minister Arun Jaitley in his budget speech.
The tax will be imposed on EPF corpus withdrawal exceeding Rs 1.5 lakh each.
So far EFP withdrawal have been free from tax exemptions in last five years.