Query 20211018 on Income Tax

Hi ,

It seems there are different versions to the below query. I would request to the person responding to reply with full responsibility . Thank you

" Is tax exempted on post office savings bank account ( Single holder) upto ₹ 3500/- in a financial year still available to tax payers or the same has been abolished."
Hence the post office interest upto ₹ 3500/- needs to be shown under exempted income in ITR & the same shouldn't be added to other iinterest income from banks
Moreover 80 TTA (₹ 10000 ) can be availed over & above this exemption 0f ₹ 3500.
Any amount of post office sb account interest above ₹ 3500 would be subjected to tax and need to be added to interest from SB account.
Please correct me if I'm wrong.

Thanks

Hi Venkat,

Let me clarify the points regarding tax exemption on Post Office Savings Bank Account interest:

Is the ₹3,500 exemption on Post Office Savings Bank interest still applicable?
- No. The earlier exemption of ₹3,500 on interest from Post Office Savings Account (and similar small savings accounts) has been abolished from FY 2012-13 onwards.
- All interest earned on Post Office Savings Accounts is now fully taxable under the head "Income from Other Sources."
Should interest from Post Office SB be shown as exempt income in ITR?
- No exemption now exists, so the entire interest earned from Post Office SB should be shown under taxable income.
- It should not be reported as exempt income.
Section 80TTA and ₹10,000 deduction:
- Under Section 80TTA, a deduction of up to ₹10,000 is available on interest income from savings accounts (including Post Office Savings Account).
- This deduction is available over and above the taxable interest income and reduces your taxable income.
Interest above ₹3,500 is taxable and added to other interest:
- Since the ₹3,500 exemption is abolished, all interest from Post Office SB accounts is taxable and must be included with other interest income from savings accounts.

No exemption of ₹3,500 now.
Report entire Post Office SB interest as taxable income.
Claim up to ₹10,000 deduction under Section 80TTA (on combined interest income from savings accounts).