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Family Pension Income Tax on principal withdrawal

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Manoj Punjabi

Accountant

383 Points Posted on 27 July 2024

Dear Friends,

I have a pension query, please guide.

If I withdraw full amount from Family Pension account of HDFC, amount is 7 lacs, and invest this whole amount in Bank FD’s.

Will that amount 7 lacs be taxable?? Senior citizen.

Note:

This I want to do because I have to make regular trips to bank for KYC as they want to check that person is alive. At regular intervals they stop pension again.

I would be free from such harassment / hindrances if I invest in FD’s.

Replies (3)

Quick Summary

A senior citizen is seeking advice on whether withdrawing the full amount from their HDFC family pension account, which is £700,000, and reinvesting it in bank Fixed Deposits (FDs) would be subject to tax. They are considering this to avoid the hassle of regular KYC checks and pension interruptions. The advice given is to check the policy document for premature withdrawal taxability or contact the pension provider's helpline for a definitive answer.