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nps contribution

Manjeet Bhati (2 Points)

26 June 2018

nps contribution other than normal deduction comes under which section

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CA Naveen Chand (Chartered Accountant) (12739 Points)
Replied 26 June 2018

80CCD

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Nishchal Rastogi (Accounts Executive) (59 Points)
Replied 26 June 2018

Section 80CCD(1B) ,

Additional exemption up to Rs 50,000 in NPS is eligible for income tax deduction.
Introduced in Budget 2015, fro FY 2015-16
Taxpayers in the highest tax bracket of 30 per cent can save Rs. 15,000 by investing Rs. 50,000 in the NPS. Those in the 20 per cent tax bracket can save aroundRs. 10,000, while people in the 10 per cent tax bracket can save Rs. 5,000 per year by investing in the NPS.
The additional tax benefit of 50000 is over and above the benefit of 1.5 Lakhs which can be claimed as a deduction under Section 80CCE.
It is irrespective of the type of employment. So, a government employee, a private sector employee, self-employed or an ordinary citizen can claim the benefit of Rs 50,000 under Section 80CCD(1B).

Therefore, the total tax benefits that can be claimed for NPS under Section 80CCD(1) + Section 80CCD(1B) equals to Rupees 2 Lakhs for a financial year.

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