Nps sec 80ccd (2)

in 80ccd (2) employer contribution other then central government
if state government contribution is 14% then 4 % will be taxable Or not in the hand of employee
Replies (2)
Quick Summary
This discussion clarifies the taxability of employer contributions to NPS under Section 80CCD(2). Specifically, it addresses whether the 4% of salary contributed by a state government employer, exceeding the 10% limit for 'other employers', is taxable in the employee's hands. The consensus is that this 4% is indeed taxable, unlike the 14% limit applicable to central government contributions.

Originally posted by : anshul tiwari
in 80ccd (2) employer contribution other then central government if state government contribution is 14% then 4 % will be taxable Or not in the hand of employee

(2) Where, in the case of an assessee referred to in sub-section (1), the Central Government or any other employer makes any contribution to his account referred to in that sub-section, the assessee shall be allowed a deduction in the computation of his total income, of the whole of the amount contributed by the Central Government or any other employer as 21[does not exceed—

(a)  fourteen per cent, where such contribution is made by the Central Government;

(b)  ten per cent, where such contribution is made by any other employer,

of his salary in the previous year.]

 

YES 4 % is taxable in your case

Why such discrimination between Central Government and State Government NPS employees. 14% for central government and 10% for State government employees.

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