—Ravi

It is assumed that you have ceased employment before completing the age of 55, and you have not migrated abroad permanently.

Queries 1, 2 and 3: The accumulated PF balance due and payable to the employee (the balance to his credit on the date of cessation of employment) is exempt from tax if he has rendered continuous service for a period of five years or more. Where there are multiple employers and the PF balances are transferred to the PF account with the most recent employer, the cumulative period of employment is seen. Since the cumulative period of employment is more than five years, the accumulated balance to the extent payable to you post ceasing employment with employer B shall be exempt.

It may also be noted that for the period that you were on a break from employment, you would not be considered as an employee of any organization and, hence, any accretions in the accumulated PF balance due to you during this period would also be taxable in your hands. Tax on the same should be paid through the prescribed advance tax instalments (if applicable) and/or self- assessment tax prior to filing of the tax return.

As you have rendered continuous service for a period of five years or more, there should be no TDS, while crediting these amounts to you/or at the time of withdrawal made immediately post cessation of employment with employer B.

Parizad Sirwalla is partner and head, global mobility services, tax, KPMG in India. Queries and views at