TDS for Kisan Vikas Patra (Post office)

Dear Mr. Srinivas,

The KVP deposits are exempt from Tax Deduction at Source (TDS) at the time of withdrawal.

Thanks

Praveen

yes. This I read.

I found the statement " Interest accrued on yearly basis will be taken as income  for Income Tax purposes" in indian postal website.

to make my question simpler. If I invest 10 lakh in KVP, after 8 years 7 months. I must get 20 lakh without any TDS deduction?

Will I get 20 lakh?

Dear Srinivas,

Yes, you will get 20 Lacs at the time of maturity, because intrest accrued on deposit will consider as "INCOME FROM OTHER SOURCES". every year you are paying tax on that income (if applicable).at time of maturity there will NO Tax again.

Oh! Like NSC. Is it? Thank you.

Difference is there..

In NSC, accrued Interest amount treated it as a RE INVESTMENT and it is eligible u/s 80 C but it is not possible under KVP.

Regards,

Ravi