scorecardresearchWorried about losing interest on your EPFO account? This is what finance

Worried about losing interest on your EPFO account? This is what finance ministry has said

Updated: 06 Oct 2022, 05:04 PM IST
TL;DR.

There is no loss of interest for any subscriber. The interest is being credited in the accounts of all EPF subscribers. However, that is not visible in the statements in view of a software upgrade being implemented by EPFO (Employees’ Provident Fund Organisation) to account for change in the tax incidence, the finance ministry said.

An collectible banknote buyer holds Indian rupee banknotes in Mumbai, India, on Wednesday, July 20, 2022. The rupee slid to all-time low of 80.06 per dollar on Tuesday, and has lost 2.4% over the past month, the third-worst performing Asian currency over the period. Photographer: Dhiraj Singh/Bloomberg

An collectible banknote buyer holds Indian rupee banknotes in Mumbai, India, on Wednesday, July 20, 2022. The rupee slid to all-time low of 80.06 per dollar on Tuesday, and has lost 2.4% over the past month, the third-worst performing Asian currency over the period. Photographer: Dhiraj Singh/Bloomberg

(PTI) The Finance Ministry has said there is no loss of interest rate for EPFO subscribers and the delay in crediting interest for the last fiscal is due to software upgrade being conducted.

It further said that for all outgoing subscribers seeking settlement and also those withdrawing their deposits, the payments are being done inclusive of the interest.

"There is no loss of interest for any subscriber. The interest is being credited in the accounts of all EPF subscribers. However, that is not visible in the statements in view of a software upgrade being implemented by EPFO (Employees’ Provident Fund Organisation) to account for change in the tax incidence," the ministry tweeted late on Wednesday night.

The ministry said this on Twitter in reply to a tweet by IT industry veteran TV Mohandas Pai, who raised queries on interest in the Employees’ Provident Fund deposits.

"For all outgoing subscribers seeking settlement and for subscribers seeking withdrawal, the payments are being done inclusive of the interest," the ministry noted.

Earlier in June, the government approved an 8.1 per cent interest on EPF deposits for the 2021-22 fiscal ended March 31 to over 5 crore subscribers.

The 2021-22 (April-March) was the first year when a tax on interest on contributions beyond 2.5 lakh per annum to provident fund was introduced.

In her Budget for 2021-22, Finance Minister Nirmala Sitharaman had provided that interest on employee contributions to provident funds over 2.5 lakh per annum would be taxed from April 1, 2021. 

First Published: 06 Oct 2022, 05:04 PM IST