How to treat NSC income

Hi,

I had invested (Rs 30000) in NSC 6 years back.

Now, on maturity I received Rs. 48,000.

1. Will Rs.18,000 be treated as interest income or other income?
2. Do I have to declare the full Rs.18,000 in this year's income and is this amount taxable?

Thanks!

Replies (2)

Interest income on NSC is Demmed to be reinvested for first 5 years. Hance the interest amount of 6th may be taxed.

Dear Dr. Jones,

Income of interest can be disclosed either on receipt basis or accrual basis.

If u have shown the income every year on accrual in ur return then only remaining amount is the income of the year in which NSC is matured.

If u have not shown any income ealier then entire Rs. 18,000 will be treated as Interest income of the year of maturity..

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