Monthly Pension Received by legal heir on employee's death taxable under Income from Other Sources

 

Monthly Pension

Pension is normally received on retirement, by employee himself.This pension is taxable under Income from Salaries

 

However It may also be received on death of employee by the legal heir This pension is taxable under Income from Other Sources

Standard deduction is also available in this case of

1/3 of Pension

Rs 5000

which ever is less

 

Summary

                                 Monthly Pension Received
By Employee By Legal Heir
It is normally received on Retirement It is normally received on Death
It is taxable under Income from Salaries It is taxable as Income from Other Sources
No Standard Deduction under Income from Salaries Standard Deduction available of lower of
(a) 1/3 of Pension
(b) Rs 15000

 

Note:-

(1)  Only monthly pension covered here, Lump sum ex-gratia payment paid to legal heirs on death not covered here, it is Exempt

  1. Income Tax
  2. Income from Other Sources

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CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 8 years. He provides GST Training in Delhi. Register now.