01 September 2012
Pension Received from LICLumps Sum Pension -Lumps sum Recd is tax free upto one third (1/3) of the commuted value. (Suppose Fund generated is Rs 600000/- out of this 2,00,000/- can be taken without attracting any tax liablility).Excess lumps sum withdrawal will be taxed under the head " Income From other Sources" Annuity or Periodical Pension- will be taxed under the head "Income From other Sources"
01 September 2012
Income from Pension Annuity is covered by TDS provisions u/s 192. There is no TDS provision for payment of family pension. Banks paying pension on behalf of govt. is the person responsible for payment & hence is liable to comply with the TDS provisions & will be penalized in case of default. In case of pension amounts received by non-governmental persons, the company is responsible for TDS, failing which penalty as well as penal interest would be levied on them. Pensioners can submit proofs for deduction u/s 80C, 80 D etc, & even entitled to relief u/s 89 (in case of arrears) to avoid TDS & are entitled to receive Form 16 from banks in case of tax deduction. There is no provision to give declarations by pensioners like 15 G /H to avoid TDS.
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