Budget 2022 hikes tax exemption on employer’s NPS contribution for state govt staff to 14% from 10%

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Budget 2022 has significantly enhanced the tax exemption on employer contributions to the National Pension System (NPS) for state government employees. The exemption limit has been raised from 10% to 14%, bringing state employees in line with their central government counterparts. Crucially, this change is retrospective, applying from 1st April 2020, meaning it covers assessment years 2020-21 and onwards.

Pankaj

Pankaj (Querist)
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10 February 2022 Sir
As per Budget 2022 hikes tax exemption on employer’s NPS contribution for state govt staff to 14% from 10%.

I want to ask you, above effect is applicable retrospectively from F Y 2020-2021 ?

Sir please clarify

Dhirajlal Rambhia online

Dhirajlal Rambhia online

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10 February 2022 Yes, it is proposed to be amended retrospective from AY 2020-21...
"The deduction for the state government employees u/s 80CCD would now be at par with central government employees. It is pertinent to note that once the Budget 2022 is ratified into an Act, the said amendment would apply retrospectively from 1st April, 2020 and will accordingly apply in relation to the assessment year 2020-21 and subsequent assessment years."

Pankaj

Pankaj (Querist)
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11 February 2022 Thanks sir
thank you so much

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)
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12 February 2022 Most Welcome ....

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