Taxability of retirement benefits
This query is : Resolved
22 July 2009
Hello, can any body plz tell me the provisions relating to the taxability of amount received as family pension by a widow of govt. employee?
22 July 2009
Family pension,in the given case, is taxable under the head 'income from other sources'. But a deduction can be claimed against that which is 33.33% or Rs.15,000/- whichever is less.
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23 July 2009
Thank you sir for your valuable opinion. Sir,whether a relief can be claimed u/s 89 of the said act in respect of family pension if the amount received is in the nature of arrears of past more than 1 previous years?
26 July 2025
Yes, relief under **Section 89(1)** can be claimed on family pension if the amount received includes arrears for more than one previous year.
### Explanation:
* **Family pension** is taxable under the head **Income from Other Sources**.
* When arrears of family pension (relating to previous years) are received as a lump sum in the current year, the tax burden may become disproportionately high.
* To mitigate this, **Section 89(1)** allows the taxpayer to claim relief by spreading the tax liability over the years to which the arrears pertain.
### How to claim:
* Calculate tax on total income including arrears in the current year.
* Calculate tax on income excluding arrears.
* Calculate tax on income excluding arrears but including arrears for previous years one by one.
* The relief is the difference in tax payable due to inclusion of arrears.
---
If you want, I can help you with a sample calculation or the detailed process of filing for Section 89 relief. Would you like that?
### Explanation:
* **Family pension** is taxable under the head **Income from Other Sources**.
* When arrears of family pension (relating to previous years) are received as a lump sum in the current year, the tax burden may become disproportionately high.
* To mitigate this, **Section 89(1)** allows the taxpayer to claim relief by spreading the tax liability over the years to which the arrears pertain.
### How to claim:
* Calculate tax on total income including arrears in the current year.
* Calculate tax on income excluding arrears.
* Calculate tax on income excluding arrears but including arrears for previous years one by one.
* The relief is the difference in tax payable due to inclusion of arrears.
---
If you want, I can help you with a sample calculation or the detailed process of filing for Section 89 relief. Would you like that?
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