Tax on superannuation fund

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 May 2011 Hi,

Recently received my superannuation (SA) from previous employer (private large software organization running their own superannuation trust). They deducted tax on it. I have following queries:

(1) Should they deduct tax on SA (I read somewhere on this forum that SA is not to be taxed by the employer if trust is approved)?
(2) Do I have to show this SA amount in my income tax return this FY?
(3) If yes, Will this SA be taxed as per my income tax slab?
(3) Do I have to show the "before tax deduction" amount or "after tax deduction" amount in my tax return? Say, before tax SA was 50000 and company deducted 15000 income tax on it. So do I have to show 35000 (50000 - 15000) as my taxable SA or 50000 as my taxable SA?

Kindly answer my queries at the earliest.

Regards,
Ravi

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)
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14 May 2011 In the following circumstances, the sum received from an approved superannuation fund is exempt under section 10(13) :
(i) Payment on the death of a beneficiary; or
(ii) Payment to an employee in lieu of or in commutation of an annuity on his retirement at or after a specified age or on his becoming incapacitated prior to such retirement; or
(iii) Payment by way of refund of contributions on the death of a beneficiary; or
(iv) Payment by way of refund of contributions to an employee on his leaving the service in connection with which the fund is established otherwise than by retirement at or after a specified age or on his becoming incapacitated prior to such retirement, to the extent to which such payment does not exceed the contributions made prior to the commencement of the Act and any interest thereon. Thus, refund of contributions to an employee at the time of resignation, discharge or dismissal, made after 31-3-1962, with interest thereupon, would be liable to tax.
tHEREFORE THE SUM RECD WILL BE TAXABLE
IN UR CASE
AMT BEFORE TAX DEDUCTION WILL BE SHOWN AS INCOME
U WILL GET CREDIT FOR TAX DEDUCTED

CA MANOJ GUPTA
JODHPUR
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