ITR FILING - BY PENSIONERS IN RECEIPT OF DISABILITY PENSION

[Brig Narinder Dhand]

 

Dear Hav Sahoo,

 

BY MID MAY WE WILL BE HOSTING A SPECIAL POST ON THE SUBJECT IN OUR BLOG SITE

GIVING LIVE EXAMPLE .

 

AS REGARDS YOUR QRYs PLEASE SEE MY  COMMENTS and guidelines IN BOLD RED with

ref to  black colour text below.

 

MOST OF THE PENSIONERS HAVE SIMILAR QUESTIONS AND DOUBTS AND IT WILL BE OUR

ENDEAVOUR TO PLACE A SIMPLE POST FOR EASE OF UNDERSTANDING AND ON DO – IT - YOURSELF CONCEPT..

 

 

ब्रिगेडियर_नरेन्द्र_ढंड
Brigadier Narinder Dhand.
NOIDA -(NCR) - 201303
EMPOWER YOURSELF WITH INFO
CLICK http://signals-parivaar.blogspot.in

 

From: janendra kumar sahoo

Sent: Monday, 9 April, 2018 20:15

To: nkd...@gmail.com

Subject: Section 139- Under Section : 80U

 

Sir,

Again I am disturbing you in your busy schedule for some query of many disable veterans in my circle.

The disability pensions given to Armed Forces Personnel are having two components-disability element & service element.
Both are tax free vide Ministry of Finance notification read with clarification from CBDT and also there cannot be any TDS as the amount is fully tax free..    CORRECT – BANK SHOULD BE INFORMED NOT TO DEDUCT ANY TDS, THEY ALREADY HAVE YOUR PPO SHOWING DISABILITY ELEMENT AND WILL ABIDE BY THIS.

But, as per Income Tax Act 1961 as amended by Finance Act 2017, Chapter VIA (Double Taxation Relief), Section-192 (Salary), Section-80U (Deduction in case of disable)
Deduction of Rs. 75,000 is allowed for people with disabilities (More than 40%) and Rs.1.25 lakhs for people with severe disability(80% more) ONLY.         THESE ARE AUTHORISED DEDUCTIONS PERMITTED FROM GROSS INCOME BEFORE TAXATION  BUT HAVE NOTHING TO DO WITH YOUR DISABILITY ELEMENT, THESE ARE SHOWN UNDER CHAPTER VI I THINK.

Now, their question is, a disable Veteran  gets Basic Service element as "X" and Basic Disability element as "Y" and Total Pension received ( X+Y+DA as applicable) per month

Hence his yearly pension/gross Income  will be ( X+Y+DA as applicable) multiple by 12 months. Suppose total pension received by individual is "Z1"

 

HERE ALSO ADD INCOME FROM OTHER SOURCE  SUPPOSE ITS TOTAL IS “Z2”   (take as Rs 138000 FOR CALCULATION PURPOSES)

As per Income Tax act amount of DA is  ALSO  taxable.  HOWEVER, THE DA AS PART OF “Z1” IS TREATED IN ACCORDANCE WITH SERVICE AND DISABILITY ELEMENTS HENCE CANOT BE ACCOUNTED SEPARATELY.  

Hence his Tax exempted  income under Sec 80U or 80DD  will be "Z" - (DA multiple by 12 months) and that amount to be reflected in the Part C of the ITR-1,
whereas, only Rs. 75,000/1,25,000 is permitted for disability and remaining amount are taxable.        INCORRECT - AS FAR AS MILITARY DISABILITY IS CONCERNED,  80 U AND IS APPLICABLE TO ALL TAX PAYEES AND FOR US IT WILL BE IN ADDITION TO DISABILITY ELEMENT

Hence, it is request please let me know if disable pension is Tax free. Why DISABLE VETERANS  have to submit income Tax return every year ?    THERE IS NO CHOICE SINCE TAXPAYEES ALSO HAVE INCOME FROM OTHER SOURCES MAY BE AGRICULTURE, BUSINESS, FDs, PPF (EXEMPT INCOME) OR JOB WHICH MUST BE REFLECTED UNDER RELEVANT HEADS .

Secondly, in ITR-1, form under  Col Section 80U/Section 80DD80-U how much amount they have to/REFLECTED/Submit ?

For example :- If any individual was received his Disability pension  for the last FY as follows :-

(a) Service element                                                   =  Rs. 2,04,000
(b) Disabile element                                                  =  Rs. 1,80,000
(c) DA (on both SE+DE)+Disability Element+DA)    =  Rs.    50,000   THE FORM 16 ISSUED BY THE BANK DOES NOT SHOW DA SEPARATELY.

YOUR CONTENTION IS WRONG, I DONOT KNOW FROM WHERE YOU HAVE GOT THE INFORMATION. DA IS NOT TREATED SEPARATELY
---------------------------------------------------------------------------------------------------------------

Total income/Taxable income                                     = Rs.   4,34,000  YES THIS WILL BE SHOWN IN THE BANK FORM 16 AND IS TO BE

ACCOUNTED FOR IN ITR-1

 

      -------------------------------------------------------------------------------------------------

HERE ALSO BRING IN THE INCOME FROM OTHER SOURCES SAY IT IS = 138000  “Z2”

 

 

 

As per Section-80C  (PPF insurance etc)  only           =  Rs      50000    (MAX ALLOWED Rs 150000)          

As per Section-80U  exempted only                           = Rs.      75,000

TOTAL CHAPTER VI          50000+75000                       = Rs        125000

_________________________________________________________________

Hence, he have to paid Tax for remaining amount        = Rs. 3,59,000       NOT CORRECT - SEE BELOW HOW IT IS TO BE TREATED:-

Please clarify for which act of your kindness, many disable veterans will be helpful.

 

IN ITR-1 IN RESPECT OF PESNIONERS WITH DISABILITY ELEMENT

YOU WILL SHOW  AGAINST SALARIER (PENSION )   =    0

 

INCOME FROM OTHER SOURCES                               = 138000  

 

TOTAL GROSS INCOME  -          128000 + 0                = 138000       

 

DEDUCTIONS    80 C AND OTHERS Ch VI   TOTAL     =   125000

 

Hence taxable income    138000 – 125000               =  13000/-

 

tax = zero      BEING BELOW Rs 2.5/3.0 LAKH

 

Income from Pension ie    “Z1”  is to be shown under “Exempt income for records only” in ITR-1  

stating “AMT OF DISABILITY PENSION RECEIVED DUE TO DISABILITY CAUSED DURING MY SERVICE IN THE INDIAN ARMED FORCES”.

The iTR Excel software will not account for this as taxable income.                    

 

THAT’S HOW IT WILL GO EVEN THIS YEAR WHILE ON LINE FILING OF ITR-1.

 

PLEASE DO HELP VETERANS WITH DISABILITIES TO FILE THE ITRs ON LINE .

 

IT MUST BE A FREE HELP AND UNDER NO CIRCUMSTANCES THEY BE ASKED TO PAY OR DONATE ANY FEES. – PROMISE THIS  TO ME SO THAT I CAN KEEP SENDING YOU GUIDANCE.

 

MY BLOG POST WILL BE ON THESE LINE AND WILL BE COMPREHENSIVE AND SIMPLE TO UNDER STAND WITH LIVE EXAMPLES, IN FACT IT IS ALREADY UNDER PREPARATION BY MY FRIEND WHO IS OWNING A CHARTED ACCOUNT & AUDIT - COMPANY

 

__________________________________________

JAI HIND

With Best regards

Hav Clk (GD) JK Sahoo, EME