If the pension is credited one yr late, through which yr’s ITR do I would like to say it? Would or not it’s completely different if it was household pension?
I suppose the pension is in respect of providers rendered by you prior to now like pension obtained from previous employer or from EPFO or in respect of superannuation annuity purchased by your employer. Such pension is handled on par with wage and is taxed below the top “Salaries”. Salary turn into taxable on earlier of accrual or receipt. So advance wage turn into taxable even not turn into due and vice versa means wage which has turn into due however not obtained but additionally turn into taxable although not obtained. So the pension although credited in subsequent yr however had already turn into due in earlier yr and subsequently grew to become taxable within the yr to which it associated. Therefore, the pension obtained one yr late must be provided for tax within the yr through which it has turn into. Please notice it doesn’t get taxed once more when it’s obtained.
In case the pension is a household pension, obtained by member of the family of the particular person entitled to obtain the pension since there doesn’t exists the connection of worker and employer between the relations and employer of the deceased, it will get taxed below the top “Income from different Sources”. In respect of income which are taxable under the heads “Profits and gains of business of profession” and “Income from different Sources” the tax payer has possibility to supply it for tax both on accrual or receipt foundation. So this turns into taxable on the identical foundation on which it was provided for tax prior to now. If you had included it in your revenue within the yr of receipt prior to now, you’ll be able to embrace it within the revenue of subsequent yr else you’ll have to present it within the yr to which it relates.
Balwant Jain is a tax and funding knowledgeable and might be reached at [email protected] and @jainbalwant on twitter.
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