Your Taxes

I am a senior citizen regularly filing I-T returns. With the enhancement in the exemption limit, I may not fall within the tax net during FY2014-15. I had made deposits in the NSS-87 in the early years of the scheme for which the necessary I-T rebate was obtained in those years. As the withdrawals from NSS-87 are taxable, I have not, so far, made any withdrawals. I am also not making any fresh deposits in the scheme for claiming deduction. Whatever amount I deposited in the scheme in the early years is lying in the scheme together with the interest thereon. My query is, I want to withdraw some amount from the scheme this year. But my total income including the proposed withdrawal will be less than the threshold limit of income for tax purposes during FY2014-15. Do I still have to pay tax on withdrawal? Would it be in order if I submit Form 15H to the concerned Head Post Office where the amount is held in deposit so that TDS can be avoided?

Thomas

Any amount withdrawn from the National Saving Scheme (NSS) shall be deemed to be the income of the assessee for the tax year in which such withdrawal is made and the amount received.

Accordingly, the same is chargeable to tax as the income of that tax year.

Income shall be taxable under the head, ‘income from other sources’. According to the provisions of income tax law, senior citizen means an individual resident in India who is of the age of 60 years or more at any time during the relevant previous year. For financial year 2014-15, the maximum amount not chargeable to tax in case of a senior citizen is ₹3,00,000.

You may note that no deduction of tax shall be made in the case of a resident individual if such individual furnishes to the person responsible for paying income of the specified nature a declaration in the prescribed form (Form 15H) to the effect that the tax on his estimated total income of the tax year will be nil. Hence, if the tax on your estimated income, including the above mentioned NSS (after availing the exemption limit of ₹3 lakh) is nil, you can submit Form 15H to the concerned head post office and the amount shall be paid to you without deduction of tax.

My son has worked in a company for two years and he has filed returns for these years. Now he has resigned and is preparing for the civil services exam. Please let me know whether he has to file an ITR for FY2014-15.

Rakesh Kaushal

If the total income of an individual during the financial year (FY) exceeds the maximum amount which is not chargeable to income tax (for FY2014-15, ₹2,50,000 for individuals below 60 years), he is mandatorily required to file the personal tax return for the said FY within the prescribed due dates.

In your son’s case, even if he is not a salaried employee now, if his total income from other heads for FY2014-15 exceeds ₹2,50,000, then he is required to file his income tax return for the said year by July 31, 2015.

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