All of us think about our future, especially our retirement. I began planning my retirement when I was thirty-five. I researched popular retirement schemes such as National Pension Scheme(NPS), Pension Funds, Annuity Certain, Life Annuity etc. With the motive to save more, I asked my friend, how much pension can I take tax free?
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How much tax free pension?The earnings of a pensioner depend upon their previous income. Let me explain if your total annual income adds up to less than your personal allowance. You won't have to pay any tax on your earnings. You can earn as much as your allowance.
The earnings depend upon the chosen investment scheme as well.
I will share an example that will help you understand how much can a pensioner earn tax-free. In an IRA investment account, If your whole pension is worth Rs.60,000. Rs.15,000 i.e. 25% of that will be tax-free. You will be taxed on the remaining Rs.45,000.
How much lump sum pension is tax free?Each time you withdraw a lump sum amount from your pension account, 25% is tax-free. When you withdraw the rest, you will be taxed on the rest of the amount at the end of the tax year.
This is all from my end on how much pension can I take tax free.
Read more :
how to claim pension tax relief
How to cancel PF claim?
In How Many Days PF Claim is Settled Online?
How to Claim PF Amount: What is the Process?
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Authors Of The Question
How much pension can I take tax free ?
HARI
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1 Answers
2 Year
2022-10-11T20:48:54+00:00 2022-10-11T20:48:56+00:00Comment
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