NRIs are not eligible to open PPF a/c

SC Vasudeva

Are deposits made by me to my major son’s (who is an NRI) active Public Provident Fund account entitled to any rebate under Section 80C of the I-T Act? Ravi Rana

Non-resident Indians (NRIs) are not eligible to open a Public Provident Fund account in accordance with Clause 3(3) of the Public Provident Fund Scheme 1968.  However, a resident who subsequently become a NRI during currency of maturity period prescribed under scheme may continue to subscribe to the fund till it matures on the non-repatriation basis.  Therefore, if your son had opened a PPF account before he became a NRI, you can deposit the amount to his account and you would be entitled to claim deduction under Section 80C for the amount so deposited subject to the specified limit under the aforesaid Section.

I am senior citizen (71 years) and residing in Mohali.  My total earnings for FY 2016-17 are: Rs 3,44,484 from pension, Rs 10,004 from the Family Pension Scheme and about Rs 8,000 as interest on savings bank accounts. I have also received maturity amount of Rs 3,98,021 on April 11, 2016, and Rs 2,81,400 on April 2, 2016, on maturity of my LIC term policy.  I have deposited Rs 50,000 in the PPF account of my adult son and paid Rs 56,730 as premium of his policies. What will be my tax liability? How do I show the amount received from LIC in income-tax return form? Nirmal Jit Singh Walia

a) On the basis of the figures given in the query your total income after availing deduction under Section 80C of the Income Tax Act, 1961, works out at Rs 2,52,490 which is less than the maximum amount on which tax is not payable by a senior citizen.  Thus, there would be no tax liability on the aforesaid amount.

b) The proceeds of insurance policy should be shown in the column wherein exempted income is required to be reflected.

At present, an individual can claim deduction up to Rs 1.5 lakh under Section 80C during the year for deposit in Public Provident Fund (PPF) and interest on PPF is tax-free. Is such interest for the year or on the deposit made so far required to be shown in income tax return as exempt income or income from other sources?  KR Singh

Interest on Public Provident Fund is exempt under Section 10 of the Income Tax Act, 1961. It can be reflected in your income-tax return in the column wherein income exempt from tax is required to be disclosed.