Friday, 19 February 2021

Withdrawal from Superannuation Fund


Superannuation is one of the retirement benefit offered to employees by their employers.

Employers contribute a fixed percentage upto a maximum of 15% of employees basic pay plus dearness allowance. This contribution is part of Cost to the company of employees.

When an employee can withdraw the money from the Superannuation Fund?

Employees are eligible to withdraw the money from the fund either at the time of retirement (or) at the time of resignation .
At any point of time, full amount available in the fund can not be withdrawn , since this is also known as pension plan. One third can be withdrawn at the time of exit from the organization and balance two third can be opted as pension. Even entire fund amount can be opted as pension.

If one third of the fund withdrawn at the time of retirement , the same is tax exempted. If the same is withdrawn before retirement , the same is taxable.

If an employee resigns and moving to other Organisation , it is possible to transfer the fund to other organization also.

Otherwise , it is recommended to keep in the fund itself till 58 years , since the fund will earn a interest based on the total fund available with the Service provider.


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