Is deduction of 20% of Gross Total Income under NPS available for Proprietors with no cap limit under 80CCD(2) like 10% in salary with no capping. Eg. If A Proprietor has 30 lakhs Gross Income and he contrubutes 6 lakhs to NpS is it tax deductible?
7 Replies
rama krishnan
(12244 Points)
Replied 19 November 2020
80ccd(2) not applicable to proprietor. you can claim a maximum of rs. 1.5 lakhs under 80ccd(1) and 50000 under 80ccd(1b). the amount claimed up 80ccd(1b) shouldn't have been claimed under 80ccd(1)
Shishir Agrawal
(7 Points)
Replied 19 November 2020
Isnt it discriminatory, as Salaried people can enjoy 10% more tax rebate over and above 1.5L+50000 +10%
I think this too should be allowed
rama krishnan
(12244 Points)
Replied 19 November 2020
There's no discrimination. for salaried people, 10% of salary is deducted towards nps which is claimed by them under 80ccd(1)/80ccd(1b). salaried people's employer also deposits 10% of salary in to their nps account which is claimed as deduction under 80ccd(2) after showing the same as income. so there's no tax effect. since salaried people enjoy 20% of salary as deduction under 80ccd, 20% of gross total income is allowed as deduction under 80ccd(1) to non salaried people whereas salaried people can claim only 10%
Shishir Agrawal
(7 Points)
Replied 19 November 2020
Sir there is no capping for salaried people eg 30Lakh salary if employer deposits 3 lakh in nps , salaried person deposits 50k amd 150k in 80c he gets total deduction of 5Lakhs.
My question is will the Proprietor also be eligible for the same like 3 lakhs in case of salary
rama krishnan
(12244 Points)
Replied 19 November 2020
If salary is 2.5 lakhs per month. 25000 will be deducted towards nps. 25000 will be deposited by employer towards nps. in ITR, the salaried person has to show the salary as 275000 (2.5 lakhs plus 25000 deposited by employer) whereas the actual take home pay is 2.5 lakhs. so the salaried people claim this 25000 under 80ccd(2) after including it as salary even though they don't get it in hand
Shishir Agrawal
(7 Points)
Replied 19 November 2020
Mr Rama you are diverting from the main topic, that js not the question. We are well aware of the facts but my question is different
rama krishnan
(12244 Points)
Replied 19 November 2020
Actually you don't understand the provisions clearly and admissions to be made in ITR. so you are confused. better google it and find the benefits of 80ccd for salaried and non salaried people. I'm done with you
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