How to handle ITR when EPF interest is credited late
What's the story
If you've noticed a delay in the credit of your Employees' Provident Fund (EPF) interest, you're not alone. This common administrative lag can create confusion when filing your income tax return (ITR). It may even lead to tax mismatches or notices if not handled correctly. Here's a simple guide on how to deal with delayed EPF interest credits and stay compliant with tax regulations.
Delay reason
Why the delay in crediting EPF interest
The government announces the interest rate late, which is why there is a delay in crediting it to your EPF account. The Employees' Provident Fund Organisation (EPFO) also takes time for internal formalities. So, even if your passbook shows interest for FY 2024-25, it may not be credited until FY 2025-26.
Reporting guidelines
How to report the income
While the interest pertains to the previous financial year, it should be reported in the year it is actually credited. For instance, if your FY 2024-25 interest is credited in July 2025, report it in your ITR for FY 2025-26. Incorrect reporting may lead to mismatches with Annual Information Statement (AIS) and Form 26AS, resulting in scrutiny or a notice from tax authorities.
Mismatch resolution
What to do if you have already filed your ITR
If you've already filed your ITR and later find that your EPF interest has been credited with TDS deducted, visit the AIS portal. Use the "Submit Feedback" option and mark the income as "information is correct but relates to a different financial year." This flags the discrepancy and avoids any confusion during ITR processing or future assessments by tax authorities.
Passbook monitoring
How to check your EPF passbook
You can use the EPFO website, UMANG app, or SMS service to check your passbook. This will give you the exact date when interest was credited. If your passbook doesn't update even a few months after the financial year ends, file a grievance via the EPFiGMS portal or call the EPFO helpdesk. Most of the time, a simple follow-up leads to resolution within days.
Withdrawal caution
Withdrawing your corpus can lead to loss of interest
Withdrawing your EPF corpus before the interest is credited can result in loss of interest for the entire year. To avoid this, wait for the passbook to show credit. This is very important when resigning or surrendering your EPF account as partial withdrawals may impact your settlement accounts if interest hasn't been credited yet.