It is most unique question, is NPS deduction can be allowed under the new tax regime? Let’s make out about this topic.
In the budget, 2020, you have to forego most of the deductions including public sector, 80C. But some deductions including employer contribution on account of NPS can still avail if you opt for a new tax regime.
Taxpayers can get tax exemption, under 80CCD, In case the employer is contributing towards employee’s NPS account, which is mandatory for Government employees, and who has joined the services after first July 2014 and voluntary retirement for those who are working in the private sector and the detection will be up to 10% and basic does the irrespective pick from the new limit qualifies for the new tax slabs.
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Already we knew that NPS has two accounts, which will Tire One and Tire two, which is mandatory for retirement, and type two is optional, and type two comes with withdrawal facility also towards MPS contribution for Central Government employees. The limit is 14% in our nation’s alone. Employees can opt through the newly introduced Income Tax Form 10-IE to, to reach at a salary person to opt for this reduction. So now we will see the new tax slabs for the F.Y. 2020-21.
However, in another income tax rule change proposing budget 2020, the employers contribution by employee’s contribution exceeding some kind if I like you name a year, towards MPS superannuation fund and the EPF will be taxable from the employee’s deposit. That was about our NPS tax benefit.