In some good cheer for subscribers who are still waiting for deposit of interest in their provident fund accounts, the retirement fund body is expected to start crediting interest for 2021-22 from Monday (October 31).
According to sources, the software upgrade for the purpose of deducting income tax has now been completed and the Employees’ Provident Fund Organisation (EPFO) will now start the process of crediting interest in members’ accounts. “For those members, who are still waiting to see the interest for 2021-22 in their accounts, the interest will be visible soon,” said a person familiar with the development.
At 8.1% interest
For the fiscal 2021-22, the EPFO has fixed the interest rate at 8.1 per cent but many subscribers have complained that they are unable to see it in their e-statements.
Earlier this month, the Finance Ministry had assured there is no loss of interest and attributed the problem to a software upgrade. “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 to account for change in the tax incidence,” it had said in a tweet on October 5.
“For all outgoing subscribers seeking settlement and for subscribers seeking withdrawal, the payments are being done inclusive of the interest,” it further said.
Following the new income tax treatment for PF contributions above ₹2.5 lakh, the EPFO has been conducting pilot test of the new software. Members’ e-passbook has to be split into two categories of less than ₹2.5 lakh and over ₹2.5 lakh so that tax can be deducted on contributions above ₹2.5 lakh, another source had explained.
The issue is also likely to be taken up at the meeting of the Central Board of Trustees of the EPFO on October 31 and November 1 as many subscribers continue to remain concerned about the status of the interest on their PF contributions.