Providing relief to about 46 lakh subscribers of 2,700 private PF trusts, the Finance Ministry has extended income tax exemption to them till March 31, 2013.
The subscribers of private provident fund trusts were facing the threat of their retirement funds coming under tax net as Budget 2012-13 was silent on this issue.
“The government has extended the income tax exemption for all unrecognised private PF trusts till March 31 next year. The amendment was incorporated in the Finance Bill which was approved by Lok Sabha yesterday,” a finance ministry official said.
In 2006, the then Finance Minister P Chidambaram had made it mandatory for all private PF trusts to seek exemption certificates from the Labour Ministry within a year for enjoying the tax benefits. Since all these trusts could not get the exemption certificates in that year, successive budgets have given annual waiver on request from the Labour Ministry.
Out of 2,700 trusts, only 284 had so far been given the exemption certificates from the Labour Ministry while 400 applications were under process.