What is the maximum tax exemption for NPS?
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What is the maximum tax exemption for NPS?
The employer’s contribution to your NPS account is tax free up to 10\% of your salary subject to an annual overall ceiling of Rs. 7.50 lakhs for NPS, provident Fund and Superannuation contribution made by the employer taken together.
Is NPS deduction over and above 80C?
An additional deduction for investment up to Rs. 50,000 in NPS (Tier I account) is available exclusively to NPS subscribers under subsection 80CCD (1B). This is over and above the deduction of Rs. 1.5 lakh available under section 80C of Income Tax Act.
Can we invest more than 50000 in NPS?
Maximum investment allowed is either 10\% of basic salary or Rs 1.5 lakh, whichever is lower. (ii) 80CCD (1b): This is an additional deduction for a maximum of Rs 50,000 which is over and above section 80C.
What happens if you exceed 80C limit?
50,000. Launched by the Government of India, the tax-saving deductions made under NPS are over and above the deductions of Rs. 1.5 lakh made under section 80C of the Income Tax Act….2. Home Loan.
| Income Tax Act | Maximum Deductible Amount |
|---|---|
| Section 80C | Rs.1.5 lakh from Principal (including stamp duty and registration fee) |
How can I pay extra 50000 in NPS?
To encourage investment in NPS, Section 80CCD(1B) of the Income-tax Act allows an additional deduction of Rs 50,000 over and above the Rs 1.5 lakh available under Section 80CCE. *It is assumed that contribution to NPS by the employee does not exceed 10\% of the employees’ salary.
What happens if I invest more than 1.5 lakh in 80C?
According to chartered accountants, this is necessary to claim the full tax-saving benefit of Rs 1.5 lakh, which is the maximum allowed under section 80C. However, in order to do this you may have to end up investing at least Rs 500 more than Rs 1.5 lakh i.e. Rs 1,50,500 in case of a lump sum investment.