TaxTMI 
TaxTMI 
Question - What are the provisions regarding the taxation of pre-mature withdrawal from EPFS in Finance Bill 2015 ?
Simplification of Tax Deduction at Source (TDS) mechanism for Employees Provident Fund Scheme (EPFS)
28 Feb 2015 
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TDS on pre-mature EPF withdrawals introduced with threshold, declaration option, PAN-based higher deduction for non-compliance.
Trustees of Recognised Provident Funds must deduct tax at a fixed rate on taxable pre-mature withdrawals when they cannot compute employee tax from income records; a monetary threshold exempts smaller payments, and employees may avoid deduction by furnishing prescribed self-declarations. Employees liable at higher marginal rates must pay any shortfall through employer deduction or advance/self-assessment tax, and furnishing a valid PAN is required to avoid higher rate deduction for non furnishing. (AI Summary)
Trustees of Recognised Provident Funds must deduct tax at a fixed rate on taxable pre-mature withdrawals when they cannot compute employee tax from income records; a monetary threshold exempts smaller payments, and employees may avoid deduction by furnishing prescribed self-declarations. Employees liable at higher marginal rates must pay any shortfall through employer deduction or advance/self-assessment tax, and furnishing a valid PAN is required to avoid higher rate deduction for non furnishing. (AI Summary)