Pension deduction

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This query is : Resolved

Ishant agarwal (Querist)

14 July 2012 Hello Sir,
one of my Lady client Received Pension on behaf of his late Husband, means she is nominee of His late Husband, Now Can there is any deduction Under which he claim a deduction on his husband Pension. She Received near 3,50,000 as a pension.

CA Rahul Gupta

CA Rahul Gupta (Expert)

14 July 2012 It is taxable in the hands of recipients under section 56 under the head “income from other sources”. Standard deduction is available under section 57 which is 1/3 of such pension or Rs. 15000, whichever is lower.
Notes: Assumed that Pension is not received by the member of armed forced.
Pension is not received from UNO

Ishant agarwal

Ishant agarwal (Querist)

14 July 2012 Thanks Sir, and if Lady self received his pension (not his late Huspand Pension) than can any deduction she will claim

CA Rahul Gupta

CA Rahul Gupta (Expert)

14 July 2012 Tax treatment depends on whether Pension is Commuted or Uncommuted:
Uncommuted pension whether received by a Govt. or a Non Govt. employee is chargeable to tax in both cases

However Commuted pension in case of Govt. is fully EXEMPT from tax but in case of Non Govt. employee is exempt on following basis:
If Gratuity is received

One-third of the pension, which he is normally entitled to receive, is exempt.

If Gratuity is not received

One-half of the pension which he is normally entitled to receive is exempt.

Ishant agarwal

Ishant agarwal (Querist)

14 July 2012 Thanks Sir

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