What Is The Full Form Of SPF In Income Tax?
SPF full form in income tax is Statutory Provident Fund, generally known as the General Provident Fund (GPF), which is a savings plan that is taken care of by all the Indian government employees, including schools and universities, and partially the railways. The fund started in the year 1925 and has ever since been operating under the Provident Funds Act. It simply deals with assisting employees to save their sum of money for life after retirement. Money put in the SPF accounts grows due to the interest on it. Interest rates are stipulated by the government, and for this reason, it can from time to time be adjusted.
The Main Benefit of Statutory Provident Fund:
SPF is a key way for government employees in India to build up savings for retirement. The money they save earns interest decided by the government, helping their savings grow safely.
Eligibility and Contribution:
The SPF is, in essence, a pension. It is obligatory for all government employees and, at the same time, for all workers in some other jobs according to the requirements of specific laws. The employees deposit part of their salary in their respective SPF, which consequently earns interest until the time of their retirement. The current prevailing interest rate stands at 7.10 percent per annum.
Benefits and Withdrawals:
This SPF allows staff to gain reasonable savings with added interest. It is a benefit that is paid in full upon retirement or after the staff is allowed to withdraw the amount. They can withdraw the money only when they have retired in most cases. Sometimes, the money can be used on large costs like medical care or to build a house before retirement.