PF contributions can't make you any richer now.

Government punctured wealth building sneaky PF trick that was making rich employees richer by amending and placing cap over maximum contribution any employee can make in his own employee PF account.

Until now, any deposit you made in your employees' PF account earned you tax free interest income for life.

Rich employees really used this opportunity to make crores of tax free nest egg. Some of them deposited their full salary in employee PF account, taking zero salary home.

But this isn't workable any more now.

Government has amended section 10(11) (of Income Tax Act, 1961) and 10(12) (of Income Tax Act, 1961). By inserting provisos to these sections, government has capped the maximum annual PF contribution to Rs250,000.

LEGAL REFERENCES

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Section - 10(11) (of Income Tax Act, 1961), Income-tax Act.

Section - 10(12) (of Income Tax Act, 1961), Income-tax Act

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PF contributions can't make you any richer now.

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Section - 10(11) (of Income Tax Act, 1961), Income-tax Act.

Section - 10(12) (of Income Tax Act, 1961), Income-tax Act

PF contributions can't make you any richer now.