a retired from government service on may 31,2018 he received a pension 10000 oer month upto jan 31, 2019. he got a lumpsum pension og rs. 500000 on feb 1 ,2019 as the commuted value of 1/4 pension
Answers
Explanation:
<Uncommuted pension or any periodical payment of pension is fully taxable as salary. In the above case, Rs 9,000 received by you is fully taxable. Rs 10,000, starting at the age of 70 years, are fully taxable as well.
Commuted pension or lump sum received may be exempt in some instances. For a government employee, commuted pension is fully exempt. For a non-government employee, it is partially exempt. If gratuity is also received with a pension – 1/3rd of the amount of pension that would have been received if 100% of the pension was commuted, is exempt from commuted pension and remaining is taxed as salary. And in case, only a pension is received, gratuity is not received – ½ of the amount of pension that would have been received if 100% of the pension was commuted is exempt.