Question

How to calculate provident fund tax, where to declare in IRIS

Answer 1

1. Tax applies only if the employer’s contribution exceeds 10% of basic salary or if the withdrawal is before 5 years of continuous service.

2. The excess contribution or early withdrawal becomes taxable as “Salary” income.

3. Calculate the taxable amount and add it to Salary → Other Allowances in IRIS.

4. Show the tax deducted (if any) under the relevant section 149 (salary).

5. Attach supporting documents or employer certificate while filing the return.

Comments

My employer deducted tax as excess of 16% profit under section 149 and paid to FBR under section 151. Could you please explain this why paid under 151 instead of 149 and now where i declare it (which section)?

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How can we explain something done by your employer? You should approach your employer for any explanation to the above.