Hello guys and respected members,
I'm planning to investment in pension fund in LIC. I want to know whether maturity amount is taxable or tax free. and kindly also help me for knowing the exact tax provision on same.
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Taxability on pension amount
Replies (7)
pension plans have option at time of maturity to receive pension in lumpsum or uncommuted meaning thereby to receive periodical monthly payments
the periodical monthly payments namely uncommuted pension is always taxable and commuted pension is exempt
Thanks sivaram for your advise.
There is some provision where it is mentioned that only 1/3 commuted pension is exempt and remaining 3/4 is taxable..what is this???
There is some provision where it is mentioned that only 1/3 commuted pension is exempt and remaining 3/4 is taxable..what is this???
this is for non govt employee who receives gratuity and also pension then 1/3rd of the commuted pension is taxable has he commuted the 100% of the pension for govt employees this commuted pension is fully exempt
word of caution dont buy these products based on advertisement the returns are low as they dont invest in equities on surrender you loose heavilyand the tax benefits you claimed would also reverse on maturity you cannot withdraw the entire corpus you have to compulsorily buy annuity try for NPS or choose PPF which would be your better option
But it is LIC product and the person has given the flow chart of maturity benefit. I don't think so ki LIC will fool us. and just want to clarify what is the tax benefit reversal at the time of maturity...
hi sivaram,
still I have doubt whether commuted pension for non government person other than employer is exempt or taxable.
still I have doubt whether commuted pension for non government person other than employer is exempt or taxable.
at the time of maturity you cannot claim the enite amount meaning thereby you have to commute say 60% or 70% of your 100% pension rest you have to buy annuity meaning thereby rest you will get only periodical monthly payments and I think the commuted pension you receive on maturity would be fully exempt just check with other experts too in this regard
I Know you are going for LIC Product even then please do evaluvate with other pension products but I have given a general note if you know any good financial planner please take their advises about the return
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