Now new government staff and even other employer are providing pension through contribution to New Pension Scheme . Government employees will be happy to note that Finance Bill 2011-12 has one amendment which will give them big tax relief. The relief is that now the contribution by central government or any employer to new pension scheme up to 10 % of salary shall be given additional deduction u/s 80CCD . Thus the , the contribution by govt or employer will be tax free.
The government has rectified this anomaly by simply changing the word “section 80CCD ” to sub-section 1 of section 80 CCD ” in section 80CCE which limits the aggregate deduction u/s 80C, 80CCD and 80CCC to Rs 1 lakh only.
Now the amendment proposed by Finance Bill 2012 is that Rs 1 lakh limit will be as under
1. Deduction u/s 80C
2. Deduction under sub section 1 of 80CCD (1) (Employees contribution )
3. Deduction u/s 80CCC
Sub section 2 of section 80CCD deals with the pension contribution by government or employer.
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The government has rectified this anomaly by simply changing the word “section 80CCD ” to sub-section 1 of section 80 CCD ” in section 80CCE which limits the aggregate deduction u/s 80C, 80CCD and 80CCC to Rs 1 lakh only.
Now the amendment proposed by Finance Bill 2012 is that Rs 1 lakh limit will be as under
1. Deduction u/s 80C
2. Deduction under sub section 1 of 80CCD (1) (Employees contribution )
3. Deduction u/s 80CCC
Sub section 2 of section 80CCD deals with the pension contribution by government or employer.
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