Tax liability on commuted pension
2 years ago
I retired from a CPSU. I was the member of pension fund of LIC under NHPC self contributory and post retirement benefit scheme( I have switched over to HDFC life on my retirement). At the time of switch over I had commuted 30% of my pension. Is this commuted amount from such pension scheme exempted from IT under 23 AAB of Sec 10 of IT act?
A.Yes, commuted pension will be exempt as per Section 89 of Income Tax Act read with rule 21A(4) from taxability. Therefore, you can very well avail this benefit.
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A.As per the Section 89 of Income Tax Act read with rule 21A(4) the tax payee can get exemption on the commuted pension amount hence while filing the returns you can take the benefit of that. Your advised to speak to your Chartered Accountant or the agent who would be filing your tax returns
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