PF Withdrawal: Provident Fund or PF investment is an 'EEE' investment where the income taxpayer is given tax exemption on investment, interest earned and the maturity amount. However, this exemption is available for the PF account holder only when he or she has invested kin the Pf account for more than five years. In case one decides to go for the PF withdrawal before five years of the PF account, then the PF withdrawal will be subject to income tax and TDS deduction. According to tax and investment experts, if one has an annual income of less than Rs 2.5 lakh, then one can save TDS deduction by submitting form 15g/15h for PF withdrawal. 

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Speaking on form 15g/15h for PF withdrawal Manikaran Singhal, a SEBI registered tax and investment expert said, "TDS deduction comes into play when the PF withdrawal amount is subject to income tax and that is possible only when one is going for PF withdrawal before five years of one's PF account." Singhal said that in case of one's annual income being less than 2.5 lakh, then one can submit form 15g/15h on PF withdrawal and avoid TDS deduction on the Pf withdrawal amount. But, the PF withdrawal amount would be considered as part of one's income in that financial year and if the PF withdrawal amount makes one will have to pay income tax according to the income tax slab the PF account holder would belong in that particular financial year.

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Standing in sync with Singhal's views in 15g/15h of PF withdrawal SEBI registered tax and investment experts Jitendra Solanki said, "Basically, form 15g/15h for PF withdrawal works like a declaration that one is having an annual income of less than Rs 2.5 lakh and hence he should be exempted from TDS deduction on one's PF withdrawal amount." However, he also said that the PF withdrawal amount will be liable for income tax payment if the PF account is less than five years old.

On the TDS norms on PF withdrawal before five years of PF account, Solanki said, "TDS will be deducted at 10 per cent provided PAN is submitted. However, in case, PAN card is not submitted, TDS is 34.608 per cent of the PF withdrawal amount." Solanki further added that TDS on PF withdrawal will be deducted if the PF withdrawal amount is more than Rs 50,000. This is applicable from June 2016. Earlier this limit was Rs 30,000.