Post office NSC

treatment of maturity amount of NSC
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Quick Summary
This discussion clarifies the tax treatment of National Savings Certificates (NSC) from the Post Office. While the invested amount may be eligible for 80C deductions in the year of investment, the interest earned upon maturity is taxable under 'Income from Other Sources'. It's important to note that if interest income isn't accounted for on an accrual basis, the entire maturity interest is subject to tax.

Amount invested is exempted and shown in 80c for the same year it is invested and the interest received at the time of maturity is taxable under income from other sources
Interest received at a time of maturity is fully taxable if Interest income not booked on accrual basis

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