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Is commutation of pension amount taxable?

Dhananjay Bhatt (41 Points)

03 June 2021

Is commutation of pension taxable ?

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Vinay Kamal (45 Points)
Replied 04 June 2021

The commuted pension is fully exempt from income tax for government employees under section 10(10A) of I.T. Act, 1961. For a non-government employee who receives pension along with gratuity, 1/3rd of the 100% of the commuted pension is exempt. The rest is taxed, like their salary. If a non-government employee only receives a pension and not gratuity, 50% of the 100% of the commuted pension is exempt.

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veerendar singh (tax consultant) (3301 Points)
Replied 04 June 2021

Agreed

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