Compensation received at the time of voluntary retirement or separation – 10(10C)

The Indian Income tax has provisions for tax exemptions of compensation received at the time of voluntary retirement or separation is exempt from tax if the following conditions are satisfied:

The first and foremost condition is that Compensation should be received on voluntary retirement or separation and received by an employee of the these undertakings;, an authority established under a central, state or provisional Act, local authority, university, an IIT, state government, central government, a notified institute having importance throughout India or any state, notified institutes of management, public sector company, any company or co-operative society.

Further, the compensation should be received in accordance with the scheme of voluntary retirement / separation which is framed in accordance with prescribed guidelines and the maximum exemption amount of Rs. 5 Lacs.

It is important to note that where exemption has been allowed to an employee under section 10(10C) for any assessment year, no exemption thereunder shall be allowed to him in relation to any other assessment year.

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One thought on “Compensation received at the time of voluntary retirement or separation – 10(10C)”

  1. my employer has deducted rs-45000/= as tds at the time of my VRS from my service on 30-09-2011, I was 48 years than and I have received VRS ex gratia payment of 930000/- , My CA has filled ITR returns for year 2011-12, and claimed a total refund of rs-28900/= which I have not yet received, while my co-workers those who were working at TUMKUR have already got it back, now please clarify

    1. How to get this amount back, I have contacted the CPC department, which says they have completed and sent to the assesing offficer please contact the ASSESING OFFICER, he says he is yet to get the mail from CPC
    2.will they pay any interest on this belated payment, if it is delayed further can I contact the consumer forum..? what is best way to get it without any friction..?

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