Dear Sir,
I have following queries:
Mr. X Is receiving pension from EPF and LIC after his retirement. He has not contributed any money to these pension funds and all monies were paid by the employer himself to EPF & LIC during his employment. Now Mr. X is receiving Rs. 60000/- p.a. as annuity. Whether can this annuity be treated as his monthly salary and claim standard deduction of Rs. 40000/- or 50000/- as the case may be? He is not receiving any Form 16.
Kindly guide
Regards,
Suraj
For the employees who receive pension from their ex-employer, such pension is fully taxable under the head salaries. So it is not only the active employees whose salaries are taxed under the head Salaries but also the pension receive by ex-employees is also taxed under the same head. Like Salaried employees, the pensioners are also entitled to the benefit of standard deduction of 40000 or 50000 as the case may be.
As far as Form 16 is considered, it is only receivable if TDS is deducted on the amount paid to you.
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