Standard deduction under Salary

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This discussion clarifies whether an individual can claim the standard deduction of £50,000 when filing their Income Tax Return, even if they have a PF withdrawal. The consensus is that the standard deduction is applicable to income reported under salary, regardless of the PF withdrawal amount, provided TDS was deducted under Section 192. It's advised to report the income under salary to avail this deduction.

Pragati Sharma

Pragati Sharma (Querist)
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18 December 2020 An individual gets PF withdrawn amount of Rs. 70000. TDS deducted u/s 192 @ 10%. There is no breakup of employer and employee contribution so he is reporting the entire amount as taxable.

While filing Income Tax Return, income reported under salary. The form is deducting standard deduction of Rs. 50,000 from it. Whether this will be applicable in his case?

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CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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19 December 2020 Yes, standard deduction applicable in this case.

Pragati Sharma

Pragati Sharma (Querist)
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19 December 2020 Sir but since the PF withdrawn amount consist of both employer an demployee constribution as i do not have the distribution. Normally this should be fully taxable. Can the AO disallow the deduction which i am taking

Pragati Sharma

Pragati Sharma (Querist)
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19 December 2020 Whether it will be better to report it under Other sources?

Was reporting in salary because TDS was deducted u/s 192. What will be your advice?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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19 December 2020 It has to be reported under salary only avail std deduction no problem.

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