The self-declaration form, Form 15G, for the provident fund (PF) withdrawal certifies that the petitioner will not be subject to a TDS deduction when they withdraw their provident fund prior to the specified financial year. 

When an employee withdraws money from their provident fund before five years have passed since joining the current employer and the withdrawal exceeds Rs 50,000, TDS is required by income tax regulations to be deducted. 

However, the Employees Provident Fund Organization (EPFO) will make it simpler for PF members to pre-withdraw their PF online without any TDS deduction with the introduction of Form 15G for PF withdrawal. The article below will explain how to file Form 15G with TDS effects.

Is Form 15G mandatory for PF Withdrawal? When should it be filed?

When you withdraw your PF amount before the full five years have passed, you must fill out Form 15G in order to avoid the tax deduction. However, since a PF withdrawal is tax-free if it was made more than five years ago, Form 15G is not required.

You would in fact need to pay a deduction of the TDS on the proceeds from the PF amount if you withdraw your PF amount before the end of the five years and it exceeds Rs 50,000. However, there would be no levy on the TDS if you completed Form 15G and submitted it during the specified fiscal year.

TDS On PF Withdrawal

It is essential to understand about the TDS rules pertaining to PF withdrawals when filing Form 15G for PF withdrawals. According to the section 192A, TDS must be added when a withdrawal exceeds or is equal to Rs 50,000 and the recipient has worked for less than five years in the same company. When the employee can submit their PAN card, a 10% TDS will be subtracted. If an employee is unable to submit their PAN card, then 34.61% TDS will be taken out of their pay.

TDS, however, will not be applicable to PF withdrawals. When an individual used to transfer their own PF account to another account, when they had to stop working due to an immediate health issue, or when they withdrew their PF after five years of service.

The Criteria For Filing Form 15G

In order to help you secure the TDS load associated with the withdrawal of PF, Form 15G is secured with a crucial tool. As a result, it would be crucial to understand who is qualified to submit Form 15G, and the right way to provide a false statement could result in a fine or even incarceration. Prior to submitting a 15G form for PF withdrawal, a person should become familiar with the following pertinent information and eligibility requirements:

  • Only an individual, not a firm or company, could file Form 15G.
  • One must be an HUF or an Indian citizen to qualify.
  • An individual should be 60 years of age or younger.
  • Your total income, which includes the amount you withdraw from your PF balance during the fiscal year, must have no tax deducted from it.
  • Real, accurate, and complete information must be entered into the form.

Important Information to Consider When Filing Form 15G

  • It is not necessary to send PF Form 15G to the Income Tax Department. Simply submit it through the EPFO online portal.
  • You must complete a separate Form 15G every year because Form 15G is required to be applied for a specific fiscal year. The option to deduct TDS will therefore not be available.
  • Verify your age to make sure it’s under 60.
  • A Unique Identification Number, or UIN, is something you would get from the income tax division if you were a TDS deductor. As a deductor, you must submit Form 15G statements on a quarterly basis and keep those statements on file for at least seven years.
  • Indicate the proper assessment year, and double-check the information that has been duly provided.
  • For the submission of Form 15G, a copy of the PAN card is required.
  • Once you have submitted Form 15G, don’t forget to save your acknowledgement slip.

How to Fill Up Form 15G

Part 1:   

This section applies to anyone requesting a deduction for no tax deducted at source on specific incomes. These people would be required to fill out the form 15G for PF by providing the same crucial details.
  1. Under the enrolled documents are the taxpayers’ names.
  2. information regarding PAN cards.
  3. Individual, Hindu-Undivided Family (HUF), or any trust tax status.
  4. Status as a resident, address information, and PIN code.
  5. ID for email and phone.
  6. When you have received a tax assessment under the Income Tax Act of 1961, check the box next to “yes,” making sure to note the most recent assessment year of returns.
  7. The details of the anticipated income for which the declaration would be made.
  8. Enter the data pertaining to the interest income from investments last. Enter your PF account number in the corresponding field.

Part 2: 

The individual who deposits TDS to the government on behalf of the taxpayers would fill out the form. Indeed, the term “deductor” would refer to the same person.

Penalties of Not Filing Form 15G

According to Section 277 of the Income Tax Act of 1961, any fictitious declaration in Form 15G intended to evade TDS will result in severe fines and imprisonment. The details of the punishments are as follows:

Offence

Punishment

If a false declaration is made to evade taxes:

 

More Than 1 Lakh Rupees

Imprisonment for a period of 6 months to 7 years

Additional Cases

Imprisonment for a period of 3 months to 3 years

And with that, filing form 15G is incredibly simple. You must have a thorough understanding of the law you are dealing with in order to adhere to such rules and regulations. Therefore, keep reading Finsights: Best GSTR 2A/2B Reconciliation Software to learn more about such topics.