even computing the income from pension,should pension actually received net of commutation be taken or gross amount ?
CA Ksheerabthi Nathan (CA in practise) (167 Points)
27 September 2011even computing the income from pension,should pension actually received net of commutation be taken or gross amount ?
Jayesh
(Internal Auditor)
(214 Points)
Replied 27 September 2011
Pension actually received should be taken......and not gross amount.
m sure on the above, but still wait for more reply.
surender
(Manager Accounts)
(149 Points)
Replied 28 September 2011
calculate on net after deductions allowed.
It has been clarified by CBDT vide circular No. 771 dt. 3/11/98 that in the case of pensioners receiving pension through nationalised banks, provisions of TDS are applicable in the same manner as they apply to the salary income.
From the income being paid as pension the banks are required to deduct specified amount of standard deduction u/s 16. Similarly they are required to allow deductions under chapter VIA, tax rebate u/s 88, 88B (in respect of senior citizens) & 88C. (Under the income tax act any person who has attained the age 65 years or more during the previous year is treated as senior citizen and a rebate of Rs. 15,000/- or the entire tax payable whichever is less, is allowable u/s 88B.)
The rebate u/s 88 is allowable to the pensioner on furnishing of relevant details by him to the bank. Similarly relief u/s 89(1) for the arrear of pension received is also to be granted by the banks, instructions in this regard have been issued by Reserve Bank of India vide R.B.I.'s pension circular (Central Series) No. 7/CDR/1992 (Ref No. PGBA. GA: (NBS) No 60/GAG4 (11CVD-91/92) DT. 27/4/92.
LIVE Form 10 B and Form 10BB: Handle Tax Audit Reports of Charitable Organizations(with recording)
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