Hi,
My dad was a bank employee and he passed away in March 2010 while in service. The PF, gratuity, insurance and other benefits got credited to my mother during last financial year. My query is if this should be considered as taxable income for my mother? If so which among these benefits should be considered for tax?
Thanks in advance.
Regards,
Harish J
added to the reply of respected @ kaushal
Taxability of graduity (subject to ceiling) may get applied if the employee is alive, but in case of his death, its superauunation fund received by legal heir, and it is not income for her, so i feel that its not a taxable income.
However if its put taxable by employer, 89(1) benefit is still available for claim.
In this case, Gratuity received by legal heir will be taxable in the hands of "Income from other sources" there are two ways
Employees covered under gratuity act any other employee
minimum of the 3 limits: minimum of the 3 limits:
1). actual amt. received or 1). actual amt. received
2). 15 days salary for completed year, 2). Half months average salary of each or part exceeding 6 months 7 days salary for each completed year of service
season in case of employee in seasonal establishment or 3). Rs. 10 lakh prior to 24/05/2010
3). Rs. 10 lakh prior to 24/05/2010 it was 350000/- it was 350000/-
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