You need to show the interest accrued for each year in your tax return which stands reinvested automatically since you have not received it in that year. Thus at the end of 6 years you have already been assessed for the interest and hence no tax is payable.
2007-03-13 20:24:56
·
answer #1
·
answered by KVISHWAS 3
·
0⤊
0⤋
We are currently under EEE regime and under this the amount is not taxable. Here is an excerpt on this -
"NSCs offer tax benefits as per the provisions of the Income Tax Act, 1961. Rebates are available under Section 88 of the Income Tax Act, 1961 on both the principal as well as the interest income."
The goverment is planning to shift to EET regime, although this was not passed in this budget, but there are talks going on for about 1 year. We may see this implemented may be next year. Once it is brought in effect then subsequent investments done will attract.
2007-03-14 20:50:07
·
answer #2
·
answered by sachintel 2
·
0⤊
0⤋
This depends on how you account for the interest. At present if you take interest as the accrued income on year wise basis, the same is also taken as re-investment made by you in NSC and accordingly the amount of interest shall be exempted as investment but the accrued interest shall be taxable in your hands as the provisions of Section 80L has been withdrawn. The impact of showing interest on accrued basis allows you to pay tax at lower rate but if you show the interest on receipt basis your income shall increase by 60 thousand and if you have income above 2 lacs it will no in next slab and attracts more tax
2007-03-17 05:46:07
·
answer #3
·
answered by ssunderagarwal 4
·
0⤊
0⤋
Accrued interest from NSC are also eligible for Section 80C deduction therefore it will not be taxed at the time of maturity.
The interest will be added in the total income and deduction U/s 80C will be allowed upto Rs 100000
2007-03-15 11:16:26
·
answer #4
·
answered by koushikchari 1
·
0⤊
0⤋
Interest is taxable in the relevant year in which it is accrued.thus the interest accrued in the 6th year alone is taxable in the last year. It will not be eligible u/s 80c as the same is received and not reinvested.The principal portion is not taxable.
2007-03-14 05:25:13
·
answer #5
·
answered by reddyccm 2
·
0⤊
0⤋