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Tax evasion checklist: Withdrawing PF within five years of joining a company
Posted on  
February 14, 2012
 
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When shifting to a new company, the PF account under the previous company can be transferred to the new company. This way, the PF amount contributes to retirement planning. By withdrawing the PF amount while shifting jobs, the individual is liable for tax on the amount withdrawn.


The tax laws state that if the PF amount is retrieved before delivering 5 years of continuous service to the company, the amount will be added to the individual's income for that year and normal tax rates will be applied.


Here are the common reasons where you must cross-check before handing over your income tax return (as published in ET Wealth on Feb 13, 2012):




      About the author
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      Sudhir Kaushik has been a practicing tax consultant for the last 17 years. He is a Fellow Chartered Accountant and conducts seminars in large companies to help salaried employees with income tax and investment queries. Sudhir brings domain knowledge of income tax laws and their compliance difficulties faced by individuals. He is the author of Income Tax Handbook For Salaried Employees for smart financial planning and investments for salaried people. He enjoys an excellent reputation and has a strong network in the corporate sector and public sector undertakings.
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