Employer contribution cap for recognised provident funds limits taxable excess and permits full transfer to notified pension schemes.

Rule 6 of the Fourth Schedule is amended to impose an upper ceiling on employer contributions to recognised provident funds for purposes of taxing contributions in excess of twelve per cent of salary, thereby capping the taxable measure of excess employer contributions. Rule 8 is expanded to treat the full transfer of an employee's provident fund balance into a notified pension scheme as an explicit alternative transfer route under the Schedule. The amendments operate from 1 April 2017.

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