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Tax treatment of NPS
Suppose a govt employee has accumulated total of Rs 100 in NPS. Upon retirement he would get Rs 60 as lumpsum and remaining Rs 40 would be annuitised. What would be tax treatment for Rs 60 (i. e. lumpsum portion)
Replies (1)
Upon retirement, up to 60% of your NPS corpus withdrawn as a lump sum is tax-exempt. The remaining portion used for an annuity is tax-free at the time of purchase, but the subsequent pension income is taxable based on your applicable income tax slab.
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