Hi. Dear
In the Ist year of purchase of NSC of Rs. 35,000/- what is the Tax Treatment in Ist yr, 2nd Yr, 3rd Yr, 4th Yr, 5th yr & 6th Yr. ? What is to be done for Interest part earned every year and on Maturity - Principal + Interest ? what is to be done. Pl inform required Urrently.
Regards n Gd Day
Hi Dear,
In respect of your Investment in NSC, you will get deduction u/s. 80C upto max. limit of Rs. 1,00,000/-. There is no 1st or 2nd year provision in respect of this.
In case of Interest earned on NSC, it is taxable under the head "Income from Other Sources". It is advisable to include this Interest in your Income on yearly basis instaed of on maturity.
If you don't declare this interest in your Income, then at the time of maturity of NSC you will have to pay the tax on benefit received (i.e. the difference between Amount Invested and Amount received on Maturity). However, if you declare interest as part of your Income regularly, then don't worry about the taxability of Maturity Value since it will not be taxable.
w.r.t contribution to NSC is allowed as deduction u/s 80C the proceeds from NSC i.e. interest is charged to tax on the principle of Exempt, Exempt, Tax. In order to save on total outflow on maturity its always better to offer accrued int on NSC to tax under the head Income from other sources.
pls sir last 10 year nsc interest rate give me
Any subscripttion by an individual / HUF to NSC (VIII Issue). Any interest accrued on these certificates which is deemed to be reinvested also qualifies for deduction;
any amount invested in NSC is qualified for deduction under section 80 C upto Rs.100000/-.
interest is to be calculated by assessee himself and to be added under the head income from other sources as income. because the interest is not received regularly. it is received on maturity. so it is treated as deemed to be reinvested in NSC so this is also qualified as deduction under section 80C.
if assessee regulary shows this interest under the head other sources and claims deduction then at the time of maturity whole of the amount received i.e. principal and interest is exempt from tax. but if asseess don't claim this then at the time of maturity total interest received i.e.difference between investment and amount received is taxable under the head other sources
Dear Sushil,
This might help you to calculate interest on NSC
National Saving Certificate (VIII) is issued for 6 years. Premature withdrawl is not allowed.No TDS at the time of encashment.Can be purchased on Minor's name , but an NRI is not eligible to purchase NSC.It is available in denomination of Rs100,Rs500,Rs 1000, Rs 5000 & Rs 10,000.
Accrued Interest on NSC of Rs 100
Year of Accrual
If purchased on or after 1/3/2001 but before 1/3/2002
If purchased on or after 1/3/2002 but before 1/3/2003
If purchased on or after 1/3/2003
First year
9.72
9.20
8.16
Second Year
10.67
10.05
8.83
Third year
11.71
10.97
9.55
Fourth Year
12.85
11.98
10.33
Fifth Year
14.10
13.09
11.17
Sixth Year
15.47
14.29
12.08
| Originally posted by : Sushil Shinde | ||
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pls sir last 10 year nsc interest rate give me |  |
Hi patricia
NSC is an investment in which the interest earned every year is considered to be reinvested.So in first year u will get deduction of 35000. Now for the interest part.every year u will show interest earned in income under the head other source and will claim deduction of the same under section 80C. In the sixth year ur interest part will be taxable under the head income under the head other source.
and one more thing.
NICE NAME
hi........to all dear frnds...
basically i will suggest not to tax on accrual basis but to tax the interest amount at the maturity time.
it will save money in present and also benefit of present value of future amount.
now howz dat?
CAclubindia
