HonestTaxpayer (Software Engineer) (103 Points)
25 July 2009Hi,
I had a query related to my Post Office 6 yrs NSC purchases I made around 6 years back.
I want to know if the interest received on NSC, on its maturity, has to be included in the income? Or is it exempt from income tax and will be shown in exempted interest category?
Satish
(CA Final Student)
(479 Points)
Replied 25 July 2009
Interst on NSC shall be included in the total income either every year on accrual basis or on Maturity. It is not exempted. But the advantage in including the same on accrual basis every year is that it can be claimed under section 80C as a deduction being reinvested every year. The said deduction cannot be claimed in the year of maturity.
NiTiN JAiN
(TAX CONSULTANT & CA FINAL STUDENT)
(155 Points)
Replied 25 July 2009
Intt. on NSC is taxable but the rebate of the Reinvested intt. on NSC is also be taken within the limit of Rs 100000 for deduction u/s 80-C . Also the deduction cannot be claimed or given in the year of maturity
HonestTaxpayer
(Software Engineer)
(103 Points)
Replied 27 July 2009
Hey thanks a lot for the prompt and helpful replies. Really appreciate it!
"Live class on Python for Financial Analysis: Unlocking Efficiency in Accounting and Finance"
CAclubindia
