Jamshedpur 27th Mar 2020: Employees of Tata Steel and its subsidiaries will be taxed on the interest paid on PF. The management gave the official information to the employees on Friday by releasing a circular.
According to the amendments made by the Central Government in the recent past, all the companies of Tata Steel or Tata group are equal shareholders in the PF of the employees.
As a PF, there is a deduction of 12 percent from the basic salary of the employee. The management also deposits the same amount on its behalf in the PF account of the employees.
According to the circular issued by Partho Basu, Chief (Revenue Account and Employment Benefit) of Tata Steel, the employees whose deposits of PF of Rs 2.50 lakh per annum will be subject to income tax. But those who deposit PF amount less than Rs 2.50 lakh annually will not be taxed.
However, the salary of such employees is increased or promoted, and if they also fall within the prescribed limit, then they will also have to pay tax on the PF. This change will take effect from April 1, 2021.
Management has asked all employees to assess their Voluntary Provident Fund (VPF).