Taxability of NSC interest on maturity

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This discussion clarifies the taxability of interest earned on a 5-year National Savings Certificate (NSC). It confirms that only the interest earned in the fifth year is taxable in the hands of the subscriber upon maturity. The interest accrued during the previous years is not subject to income tax at the time of maturity.

cox769

cox769 (Querist)
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11 July 2020 In case of 5 year NSC, whether interest earned during the entire tenure of NSC is liable to income tax on maturity or only the 5th year interest taxable on maturity. Please clarify.

PAWAN KUMAR

PAWAN KUMAR (Expert)
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12 July 2020 Only 5th year interest is taxable in the hands of subscriber.

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cox769

cox769 (Querist)
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20 July 2020 Thank you very much.

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