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Deduction in respect of Contribution to certain Pension Funds [Section 80CCC]

 

The following are salient features of Section 80CCC for claiming Deduction under this Section–

  1. Who can claim deduction under section 80CCC -

    Deduction under section 80CCC is available only to an individual.

  2. What is the qualifying payment to avail deduction -

    Amount should be paid or deposited under an annuity plan of the LIC of India or any other insurer for receiving pension. Amount should be paid or deposited out of income chargeable to tax.

  3. How much deduction available under section 80CCC -

    The maximum amount deductible under section 80CCC is Rs. 1,50,000.

  4. Is there any combined maximum ceiling -

    The aggregate amount of deduction under sections 80C, 80CCC and 80CCD(1) [i.e., contribution by an employee (or any other individual) towards National Pension Scheme (NPS)] cannot exceed Rs. 1,50,000.

    However, employer’s contribution towards NPS (to the extent of 10 % of employee’s salary) shall not be considered for the ceiling of Rs. 1,50,000.

  5. What is tax treatment of Pension -

    If deduction is claimed under section 80CCC and later on pension is received by the assessee (or his nominee), such pension will be taxable in the hands of recipients in the year of receipt. Likewise, where (after claiming deduction under section 80CCC) the assessee or his nominee surrenders the annuity before maturity date of such annuity, the surrender value shall be taxable in the hands of the assessee or his nominee, as the case may be, in the year of the receipt.

  6. Quantum of Deduction:

    The whole of the amount paid or deposited (excluding interest or bonus accrued or credited to the assessee's account, if any) Or Rs.1,50,000, whichever is less.

  1. If the assessee or his nominee receives any amount (including interest or bonus), standing to the credit of the assessee in respect of which deduction under section 80CCC has been allowed to him:

    1. on account of the surrender of the annuity plan, whether in whole or in part in any previous year; or

    2. as pension from the annuity plan;

  2. such amount shall be included in the total income of the assessee or his nominee in the year of receipt.

  3. Where deduction has been allowed u/s 80CCC, deduction u/s 80C will not be available in respect of the payment made towards the annuity plan.

  4. The deduction is allowed to Non-resident individual also.

 
Deductions to be made in Computing Total Income [Sections 80A to 80U (Chapter VIA)]

Related Topics...Deductions from Gross Total Income

  1. DEDUCTIONS UNDER 'CHAPTER VI-A' IN RESPECT OF "PAYMENT & INVESTMENT" ARE ALLOWED FROM SECTION 80C TO 80GGC

    Section 80C Section 80CCC Section 80CCD
    Section 80CCG Section 80D Section 80DD
    Section 80DDB Section 80E Section 80EE
    Section 80G Section 80GG Section 80GGA
  2. DEDUCTIONS UNDER 'CHAPTER VI-A' IN RESPECT OF "INCOMES" ARE ALLOWED FROM SECTION 80-IA TO 80U

    Section 80-IA Section 80-IAB Section 80-IAC
    Section 80-IB Section 80-IBA Section 80-IC
    Section 80-ID Section 80-IE Section 80-JJA
    Section 80-JJAA Section 80-LA Section 80-P
    Section 80-PA Section 80-QQB Section 80-RRB
    Section 80-TTA Section 80-TTB Section 80-U
 

 

 
 
 
 
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