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Tax on GPF interest: University of Jammu notifies new rules

Last Updated on April 4, 2022 at 10:57 pm

Government employees are agitated over the decision of the government where the General Provident Fund (GPF) is not exempt from tax.

Nirmala Sitharaman Union Finance Minister in budget speech last year has stated that interest of GPF will will be taxed in case the amount exceeds the threshold limit.

Government has started taxing the interest on GPF from April 1, 2022. As per the notification by Central Revenue department has asked government employees with GPF subscription of over Rs 5 lakh in FY 2021-22 to intimate about “the interest earned by them before salary bills for the month of February 2022 are prepared for deduction of TDS from the pay and allowances”.

Even the University of Jammu has notified that the GPF will be taxable. The interest earned on the employee’s contribution to the provident fund account will be taxed if the contribution amount in a financial year exceeds Rs 2.5 lakh. If there is no employer contribution in the provident fund account, the threshold will be Rs 5 lakh a year.