The answer to your query, Are pension plan contributions tax deductible is Yes. Pension plan contributions are tax deductible under Section 80CCC of the Income Tax Act, 1961. You can claim up to Rs 1.5 lakh per year for premiums that you pay for policies that offer pensions or annuities. However, this limit includes deductions under Sections 80C and 80CCD(1). Let me share some more insights on this topic to help you understand how they are tax deductible.
Are Pension Contributions Tax Deductible?
Yes, pension contributions can be tax deductible under Section 80CCC of the Income Tax Act, 1961, and here are some major aspects you must know about :
Deduction Limit: You can claim up to Rs 1.5 lakh per year for premiums paid towards approved pension or annuity plans. This limit is combined with Sections 80C and 80CCD(1).
Eligibility: The deduction is for individuals (residents or non-residents) paying premiums from their taxable income. Do note that HUFs are not eligible for it.
Only policies providing pensions or periodic annuities qualify.
Bonuses or interest from the policy are not deductible.
Any pension received from the policy is taxable as per prevailing rates.
By contributing to a pension plan, you can save on taxes, so it is a smart method that you can opt for.
If you still feel confused, I suggest you consult with a tax expert and solve your queries with him.
Consult with NoBroker’s Experts to Get Thorough Tax Assessment and AssistanceRead More:
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Authors Of The Question
Are Pension Plan Contributions Tax Deductible?
Mahi56
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30 days
2024-11-28T08:45:33+00:00 2024-11-28T08:45:33+00:00Comment
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