GPF (General Provident Fund) scheme is a scheme like PPF (Public Provident Fund) that government employees use. Now the maximum annual investment limit has been fixed in this. From the current financial year, GPF account holders will not be able to deposit more than Rs 5 lakh in a year. The Department of Pension and Pensioners’ Welfare (DoPPW) has issued an order in this regard.
You can invest a maximum of Rs 1.5 lakh annually in PPF. Earlier, the government had imposed a tax on interest from GPF above Rs 5 lakh.
What is the new rule?
If the total deposit amount of a government employee is more than Rs 5 lakh as of October 2022, then his salary will stop going towards GPF. Let us tell you that the employees who invest in GPF are entitled to get benefits under the old pension scheme.
According to the mandate, the rules for monthly contributions for the financial year 2023-24 will be prepared so that the total deposit amount does not exceed Rs 5 lakh. However, it has not been clarified whether contributions above Rs 5 lakh made till October this year will be adjusted. There is no clarity on whether the excess amount will be refunded to the account holder or added to the contribution for the next financial year.
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About GPF (General Provident Fund) scheme
This scheme is only for government employees. It is managed under the Department of Pensioners’ Welfare, Ministry of Personnel, Public Grievances and Pensions. Government employees will have to invest at least 6 percent of their salary in this. This money is returned to the account holder at the time of retirement. You also get interest on the money deposited in GPF. At present, the government is giving 7.1 percent interest on GPF to the account holders.