PENSION {SEC17 (1)(II)} UNDER INCOME TAX ACT

Section 17(ii) of the Income Tax Act, 1961 (the Act) provides for an exemption of pension received by an individual. The exemption is available up to a maximum amount of Rs. 100,000 in a financial year.

The pension must be received by the individual:

• on or after the 60th birthday of the individual; or
• on or after the date of disablement of the individual, if the disablement is attributable to any of the causes specified in the Income Tax Act.

The pension must also be received from:

• the Government; or
• a statutory corporation; or
• a company; or
• a local authority; or
• any other employer, where the pension is payable out of funds to which the provisions of section 80CCD (1) (a) or (b) of the

Section 80CCD (1) (a) and (b) of the Income Tax Act. Provide for tax deductions for contributions made by an employer to a pension scheme for its employees.

The exemption under section 17(ii) of the Income Tax Act.  is available only for the actual amount of pension received by the individual. Any amount received as dearness allowance or other allowance in lieu of pension is not eligible for the exemption.

Section 17(ii) of the Income Tax Act, 1961 (the Act) provides for an exemption of pension received by an individual. The exemption is available up to a maximum amount of Rs. 100,000 in a financial year.

The pension must be received by the individual:

• on or after the 60th birthday of the individual; or
• on or after the date of disablement of the individual, if the disablement is attributable to any of the causes specified in the Income Tax Act.

The pension must also be received from:

• the Government; or
• a statutory corporation; or
• a company; or
• a local authority; or
• any other employer, where the pension is payable out of funds to which the provisions of section 80CCD (1) (a) or (b) of the Income Tax Act. Apply.

Section 80CCD (1) (a) and (b) of the Income Tax Act. Provide for tax deductions for contributions made by an employer to a pension scheme for its employees.

The exemption under section 17(ii) of the Income Tax Act. is available only for the actual amount of pension received by the individual. Any amount received as dearness allowance or other allowance in lieu of pension is not eligible for the exemption.

Section 17(ii) of the Income Tax Act, 1961 (the Act) provides for an exemption of pension received by an individual. The exemption is available up to a maximum amount of Rs. 100,000 in a financial year.

The pension must be received by the individual:

• on or after the 60th birthday of the individual; or
• on or after the date of disablement of the individual, if the disablement is attributable to any of the causes specified in the Income Tax Act.

The pension must also be received from:

• the Government; or
• a statutory corporation; or
• a company; or
• a local authority; or
• any other employer, where the pension is payable out of funds to which the provisions of section 80CCD (1) (a) or (b) of the Income Tax Act. apply.

Section 80CCD (1) (a) and (b) of the Income Tax Act. provide for tax deductions for contributions made by an employer to a pension scheme for its employees.

The exemption under section 17(ii) of the Income Tax Act. is available only for the actual amount of pension received by the individual. Any amount received as dearness allowance or other allowance in lieu of pension is not eligible for the exemption.

Section 17(ii) of the Income Tax Act, 1961 (the Act) provides for an exemption of pension received by an individual. The exemption is available up to a maximum amount of Rs. 100,000 in a financial year.

The pension must be received by the individual:

• on or after the 60th birthday of the individual; or
• on or after the date of disablement of the individual, if the disablement is attributable to any of the causes specified in the Income Tax Act..

The pension must also be received from:

• the Government; or
• a statutory corporation; or
• a company; or
• a local authority; or
• any other employer, where the pension is payable out of funds to which the provisions of section 80CCD (1) (a) or (b) of the Income Tax Act.

Section 80CCD (1) (a) and (b) of the Income Tax Act. Provide for tax deductions for contributions made by an employer to a pension scheme for its employees.

The exemption under section 17(ii) of the Income Tax Act. is available only for the actual amount of pension received by the individual. Any amount received as dearness allowance or other allowance in lieu of pension is not eligible for the exemption.

Section 17(ii) of the Income Tax Act, 1961 (the Act) provides for an exemption of pension received by an individual. The exemption is available up to a maximum amount of Rs. 100,000 in a financial year.

The pension must be received by the individual:

• on or after the 60th birthday of the individual; or
• on or after the date of disablement of the individual, if the disablement is attributable to any of the causes specified in the Income Tax Act..

The pension must also be received from:

• the Government; or
• a statutory corporation; or
• a company; or
• a local authority; or
• any other employer, where the pension is payable out of funds to which the provisions of section 80CCD (1) (a) or (b) of the Income Tax Act.

Section 80CCD (1) (a) and (b) of the Income Tax Act. Provide for tax deductions for contributions made by an employer to a pension scheme for its employees.

The exemption under section 17(ii) of the Income Tax Act. Is available only for the actual amount of pension received by the individual. Any amount received as dearness allowance or other allowance in lieu of pension is not eligible for the exemption.

Section 17(ii) of the Income Tax Act, 1961 (the Act) provides for an exemption of pension received by an individual. The exemption is available up to a maximum amount of Rs. 100,000 in a financial year.

The pension must be received by the individual:

• on or after the 60th birthday of the individual; or
• on or after the date of disablement of the individual, if the disablement is attributable to any of the causes specified in the Income Tax Act..

The pension must also be received from:

• the Government; or
• a statutory corporation; or
• a company; or
• a local authority; or
• any other employer, where the pension is payable out of funds to which the provisions of section 80CCD (1) (a) or (b) of the Income Tax Act.

Section 80CCD (1) (a) and (b) of the Income Tax Act. Provide for tax deductions for contributions made by an employer to a pension scheme for its employees.

The exemption under section 17(ii) of the Income Tax Act. is available only for the actual amount of pension received by the individual. Any amount received as dearness allowance or other allowance in lieu of pension is not eligible for the exemption.

EXAMPLES

• Pension received by a government employee from the government of any state in India, such as the pension received by a retired government teacher from the government of Tamil Nadu.
• Pension received by a private sector employee from the company he/she worked for, such as the pension received by a retired bank employee from the State Bank of India.
• Pension received by a retired military personnel from the government of India, such as the pension received by a retired army officer from the Ministry of Defense.
• Pension received by a widow or widower of a government employee from the government of the state where the government employee last served, such as the pension received by the widow of a retired government doctor from the government of Karnataka.
• Pension received by a widow or widower of a private sector employee from the company where the employee last worked, such as the pension received by the widow of a retired private sector manager from Infosys.
• Pension received by a person who is physically or mentally disabled from the government of India, such as the pension received by a person with paraplegia from the Ministry of Social Justice and Empowerment.
• Pension received by a person who is a dependent of a person who is physically or mentally disabled from the government of the state where the person with disability resides, such as the pension received by the son of a person with quadriplegia from the government of Kerala.
• Pension received by a person who is a member of a scheduled tribe or a scheduled caste from the government of the state where the person belongs to the tribe or caste, such as the pension received by a tribal woman from the government of Madhya Pradesh.
• Pension received by a person who is a resident of a state that has a pension scheme for its citizens, such as the pension received by a senior citizen from the government of Gujarat.

Case laws:

• K. Desai v. Income Tax Officer(1977) 108 ITR 363 (SC): This case held that pension received by a government servant after retirement is taxable under Section 17(ii) of the Income Tax Act, even if it is paid in a lump sum.
• S. Ramachandran v. Income Tax Officer(1984) 147 ITR 448 (SC): This case held that pension received by a private sector employee after retirement is also taxable under Section 17(ii) of the Income Tax Act.
• S. Jagannathan v. Income Tax Officer(2002) 257 ITR 393 (SC): This case held that the exemption from tax for pension under Section 10(10A) of the Income Tax Act is only available to government employees. Private sector employees are not eligible for this exemption.
• Income Tax Officer v. R.N. Gupta(2011) 332 ITR 228 (Kar.): This case held that the pension received by a government servant after retirement is taxable under Section 17(ii) of the Income Tax Act, even if it is paid in a lump sum and is in excess of the amount of pension that the employee would have received if he had retired on the normal retirement age.

Faq questions

1. What is pension under section 17(ii) of the Income Tax Act?

Pension under section 17(ii) of the Income Tax Act is a pension received by an employee from his/her employer on retirement. It is taxable as salary income under section 17(1). However, there are certain types of pension that are exempt from tax, such as pension received from the United Nations Organization (UNO) or a foreign government.

2. What are the conditions for exemption of pension under section 17(ii) of the Income Tax Act?

The following conditions must be satisfied for a pension to be exempt from tax under section 17(ii) of Income Tax Act.:

* The pension must be received from the UNO or a foreign government.

* The pension must be in the form of a lump sum amount or a regular monthly payment.

* The pension must not be taxable in the country of origin.

3. What is the tax treatment of pension received from a private company under Income Tax Act.?

Pension received from a private company is taxable as salary income under section 17(1). However, there are certain deductions that can be claimed against the pension income, such as medical expenses, insurance premiums, and contributions to provident funds.

4. How is pension income taxed in India under Income Tax Act.?

Pension income is taxed in India in the same way as salary income. The amount of tax payable will depend on the taxpayer’s total income and the applicable tax slab.

5. What are the different types of pension plans available in India under Income Tax Act.?

There are a variety of pension plans available in India, each with its own set of features and benefits. Some of the most popular pension plans include:

* Public sector pension plans: These plans are offered by the government and are generally available to government employees.

* Private sector pension plans: These plans are offered by private companies and are generally available to private sector employees.

* Self-funded pension plans: These plans are set up by individuals and are funded by their own contributions.

6. How do I choose the right pension plan for me under Income Tax Act.?

There are a few factors to consider when choosing a pension plan, such as your age, your financial goals, and your risk tolerance. It is important to speak to a financial advisor to get help choosing the right plan for you.