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Monthly Pension from EPFO exempt or taxable?

Tax queries 1902 views 1 replies

Hi,

Can anyone clarify whether monthly pension received from EPFO after retirement exempt from income tax or taxable? If taxable under which income head?

Replies (1)

Let's clarify the tax treatment of monthly pension received from the Employees' Provident Fund Organization (EPFO) after retirement: Taxability of EPFO Pension -

 *Taxable: The pension received from EPFO is taxable under the head "Income from Other Sources". -

Section 80CCD(2)*: Contributions made by the employer to the NPS (National Pension System) or EPFO are eligible for deduction under Section 80CCD(2). However, this doesn't directly impact the taxability of the pension received. Income Head -

 *Income from Other Sources*: The pension received from EPFO is taxed under the head "Income from Other Sources" and will be added to your total income. Tax Deduction -

 *TDS*: EPFO might deduct tax at source (TDS) on the pension payments if the amount exceeds the threshold limits. Recommendations -

 *Consult a Tax Professional*: For personalized tax advice and to ensure compliance with tax regulations.

- *Check Tax Slabs*: Understand the applicable tax slabs and rates to calculate the tax liability on your pension income. By understanding the tax treatment, you can better plan your finances and comply with tax regulations.


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