CBDT notifies guidelines to calculate taxable curiosity in provident fund accounts

The Central Board of Direct Taxes (CBDT) has notified the earnings tax guidelines by which curiosity earnings accrued within the provident fund (PF) above a specified restrict can be taxed.
According to the Income-tax (twenty fifth Amendment) Rules, 2021, for the aim of calculation of taxable curiosity, separate accounts inside the provident fund account shall be maintained throughout 2021-2022 and all subsequent years for taxable and non-taxable contributions made by an individual.
The new rule states that non-taxable contribution account shall be mixture of the closing steadiness within the PF account as on March 31, 2021, and any contribution made by the individual within the account in 2021-2022 and in subsequent years, which is in extra of the edge restrict.
The authorities had launched a brand new provision earlier this yr that makes curiosity accrued in PF account on contribution above Rs 2.5 lakh a yr taxable.