Deduction in respect of employer contribution to pension scheme of Central Government

Where in the case of an assessee, being an individual employed by any employer, if an employer makes any contribution in his account under a pension scheme notified by the Central Government, the assessee shall be allowed a deduction in the computation of his total income, of the whole of the amount contributed by such employer as does not exceed— 5 (a) 14%, where such contribution is made by the employer being the Central Government or the State Government; and (b) 10%, where such contribution is made by an employer other than an employer referred to in clause (a), of his salary in the tax year. 10

Where the total income of the assessee is chargeable to tax under section 202(1), the provisions of sub-section (1) shall have effect as if for “10%” referred to in clause (b) of that sub-section, “14%” had been substituted.

An assessee referred to in sub-section (1), or any other assessee, being an individual, shall be allowed a deduction in computation of his total income of 15 the whole of the amount paid or deposited in the tax year in his account under a pension scheme notified or as notified by the Central Government, which shall not exceed fifty thousand rupees.

The deduction under sub-section (3) shall also be allowed where any payment or deposit is made to the account of a minor under the said pension 20 scheme, by the assessee, being the guardian of such minor, subject to the condition that the aggregate amount of deduction under sub-section (3) and this sub-section shall not exceed fifty thousand rupees.