Is the monthly pension received under Jeevan Suraksha Pension Plan taxable? Are interests received from savings bank account with a schedule commercial bank or a post office taxable?

B. Dora, Bhubaneswar

The New Jeevan Suraksha-I is approved by the Insurance Regulatory and Development Authority and as envisaged in Section 10 (23 AAB) of the income tax act, the earnings from the fund is totally exempt from income tax. You can also claim deduction under section 80 CCC of the income tax act on the premium paid. The interest income from bank or post office savings is taxable. While banks deduct tax at source on such savings, post offices do not.

No need to worry

I am a regular income tax payer. Out of the benefits I received on retirement, I gifted some amount to my wife, son and daughter. They invested the money in post office monthly income schemes. My daughter has opened the account with me as the second account holder. Do I have to pay income tax on the interest received by them?

Chandan Roy, Calcutta

The current provisions of the income tax act exclude a sum of money given without consideration to a lineal descendant or ascendant relative from the ambit of levy. Any money gifted by parents to their children are exempt from income tax in the hands of the recipients under Section 56 of the Income Tax Act, 1961. Similarly, there is no tax implication on the donor as gift tax was abolished in October 1998. However, you will have to include the interest income from the joint account with your daughter while calculating your own tax liability.

Postal plight

I am a senior citizen. Despite giving intimation well in advance, my post office failed to make payment of the maturity proceeds of my term deposit on the due date. The postmaster even declined to give in writing his inability to give me the money. What should I do?

Dhruba Roy, Calcutta

Many post offices are now facing cash crisis as investors are withdrawing their investments from post offices on a large scale. However, this can’t be an excuse not to pay your dues on time. You can approach the vigilance officer of India Post for the Bengal circle or the post master general at Yogayog Bhavan.

If you have any queries about investing or taxes or a high-cost purchase you are planning, mail to: btgraph@abpmail.com, or write to: Business Telegraph, 6 Prafulla Sarkar Street, Calcutta 700001.