Arvind Singh Chauhan (advocate) 18 July 2010

TAX ON PENSION

One "X" is serving in army as Lt. Colonel. her husband was also in army. When her husband was Major he died. Now "x" is getting her pay + family pension of her husband. She has two minor children also.

Please suggest whether, both pay + family pension are taxable ? or only pay is taxable?

According to general rule Army pension is exepted for income tax.

Whether She is required by law to disclose her family pension while filing her return?

Please refer the clear law or provisions.

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4 Replies

A V Vishal (Advocate) 18 July 2010

I donot know how you got the misconception that pension of armed personnel are exempted from Income Tax. Further, to your question whether family pension is taxable and needs to be clubbed, the answer is yes. "Family Pension" will be taxable under the head, Income from Other Sources. The asseessee will be allowed a deduction of a sum equal to one-third ( 1/3 rd) of such income or rupees fifteen thousand , whichever is less.

Shayan Khan (B.com) 18 July 2010

please specify whether it a Simple pension OR Family pensios, since both have different tax imlications under I.T. Act.

mahendrakumar (marketing) 18 July 2010

there are no exceptions for army pension with regards to Income tax.

Vineet (Director) 23 July 2010

Family pension received by family of an army man who died on duty or who was reciepient of galantary awards such as 'Veer Chakra" and above is exempt from tax.