NSS(1989) tax

Tax queries 284 views 2 replies

Shantanu Kulkarni

1 Points Joined June 2023

everyone,

I'm new to this forum and I'm hoping you can help me with a question about my mother's NSS Postal account. She opened the account in 1989 with a deposit of ₹45,000. Over the years, the balance has grown to around ₹7 lakhs.

My question is, if she withdraws all of the money, will the post office deduct TDS? And will she have to pay income tax on the amount?

If you have any suggestions on how to avoid paying tax and TDS, I would be grateful. Also, if my mother withdraws the money and gifts it to my sister and me, will we be taxed on the amount?

Thanks in advance for your help.

Shantanu

Replies (2)

CA Aakarsh Jain

10431 Points Joined March 2019

Yes, this amount is taxable, and TDS will be deducted if the interest amount is above 50,000.
You can save your tax and take a refund of TDS deducted if your mother doesn't have any other income.
If she gifts it to you, then it will not be taxable in your hands as a gift to relatives is exempt.
If you have further doubts, then I'm leaving the details in your inbox.