This section provides tax exemptions on certain types of interest income earned from specified bonds, securities, and government schemes. The exemption encourages investments in government-backed instruments.
Key Exemptions Under Section 10(15)
- Interest on Tax-Free Bonds (Section 10(15)(iv)(h))
- Applicable to:Bonds issued by public sector companies (like NHAI, REC, IRFC, PFC, etc.).
- Exemption:Fully tax-free if issued under specified conditions.
Example:
- Investment:₹1,00,000 in NHAI Tax-Free Bonds @ 6% p.a.
- Annual Interest:₹6,000
- Tax Treatment:Fully exempt (No tax on ₹6,000).
- Interest on Gold Deposit Bonds (Section 10(15)(iv)(i))
- Applicable to:Gold Monetization Scheme (GMS)
- Exemption:Interest earned is tax-free.
Example:
- Deposit:100 grams of gold under Gold Monetization Scheme.
- Interest Earned:₹5,000 per year.
- Tax Treatment:Fully exempt.
- Interest on Post Office Savings Schemes (Section 10(15)(i) & (ii))
- Exempt Schemes:
- Post Office Savings Account (up to ₹3,500 interest p.a.)
- Senior Citizens Savings Scheme (SCSS) – Up to ₹50,000 p.a. (Section 80TTB applies for senior citizens)
- Sukanya Samriddhi Yojana (SSY) – Fully exempt
Example (Post Office Savings Account):
- Interest Earned:₹4,000 in a year.
- Exemption Limit:₹3,500 (as per Section 10(15)(i)).
- Taxable Interest:₹4,000 – ₹3,500 = ₹500 taxable.
Example (SSY – Fully Exempt):
- Interest Earned:₹8,000 in a year.
- Tax Treatment:Fully exempt.
- Interest on RBI Tax-Free Bonds (7.75% GOI Savings Bonds)
- Exemption:Interest is tax-free but no deduction under Section 80C.
Example:
- Investment:₹1,50,000 in 75% GOI Bonds.
- Annual Interest:₹11,625.
- Tax Treatment:Fully exempt.
Key Takeaways:
✅ Tax-Free Bonds (NHAI, REC, IRFC, PFC, etc.) → Fully exempt.
✅ Gold Monetization Scheme Bonds → Fully exempt.
✅ Post Office Savings (up to ₹3,500 p.a.) → Exempt.
✅ Senior Citizens Savings Scheme (SCSS) → Exempt up to ₹50,000 (Section 80TTB applies).
✅ Sukanya Samriddhi Yojana (SSY) → Fully exempt.
