TAXABILITY OF PENSION OF AN GOVERNMENT EMPLOYEE

[S.C. WADHWA]

1. Under Which head 7th pay commission is taxable

2. Whether pension have breakup as salary into Basic, DA, Medical Allowance

3. If yes, how it is taxable, whether medical will be exempted upto ₹ 15000

4. How salary/pension of Government employee is taxable, whether for April to March or March to Feb

AI Summary

Pensions under 7th Pay Commission include components like Basic, DA, and Medical Allowance; medical exempt up to 15,000/year. A government employee inquired about the taxability of pensions, specifically under the 7th Pay Commission, and whether pensions have a breakdown similar to salaries, including components like Basic, Dearness Allowance (DA), and Medical Allowance. The query also sought clarification on the tax exemption for medical allowances and the applicable financial year for tax purposes. The response clarified that pensions do have a breakdown, with medical allowances exempt up to 15,000 per year upon submission of bills, and the tax year runs from April to March. Further confirmation was requested and provided on these points.