Tax treatment of termination payments from unrecognised provident funds: employer contributions treated as salary; employee contributions exempt. Employee contributions on termination from an un-recognised provident fund are exempt from tax, while interest on those employee contributions is taxable ... Summary
Tax treatment of termination payments from unrecognised provident funds: employer contributions treated as salary; employee contributions exempt.
Employee contributions on termination from an un-recognised provident fund are exempt from tax, while interest on those employee contributions is taxable as Income from Other Sources. Employer contributions and interest thereon are treated as salary income; recipients may claim available relief for the salary-characterised portion under the statutory relief mechanism for salary receipts.
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