The following are salient features of Section 80CCC for claiming Deduction under this Section–
Who can claim deduction under section 80CCC -
Deduction under section 80CCC is available only to an individual.
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.
How much deduction available under section 80CCC -
The maximum amount deductible under section 80CCC is Rs. 1,50,000.
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.
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.
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.