Pension to Disable Armed Force Personnel Fully Tax-Free!

0
56
Print Friendly, PDF & Email
disability pension

This quick post is on account of latest circular issued by the CBDT on the subject of tax exemption to armed force personnel who are invalidated during service . So here are major points on the issue of tax exemption of the pension received by such invalidated armed force personnel.

1. The pension received by a armed force personnel -Army, Navy or Air-Force- is fully exempt vide. (refer Finance Ministry notification No 878-F (Income Tax) dated 21-3-1922 ).

2. The disability pension is tax free for all ranks of armed forces- In other words, for the purpose of tax exemption, there is no difference between a disabled officer and a disabled soldier.

3. The disability pension is tax exempt only if armed force personnel was disabled or invalided during service and not after retirement.

For point 2 & 3 refer latest cbdt circular 13/2019 dt 24th June 2019.

4. The aggregate disability pension i.e disability element and service element- is tax free. Refer CBDT instruction F. No. 200/51/00-ITA-1 dt. 02.7.2001

5. No TDS is required on the said disability pension paid to Armed Forces personnel. Refer the Press Release, Dated 20-12-2007 by RBI .

Please read the earlier article No TDS on Disability Pension to Armed Forces Personnel