# Family Pension — Taxation & Deduction

## Meaning

Monthly pension received by family members of an employee from the employer after the death of the employee.

Note: Pension received by the employee himself is taxable under Salaries; pension received by the family is taxable under IFOS.

## Deduction [Section 57(iia)]

Deduction = Lower of:

1/3rd of family pension received, OR
₹ 15,000 p.a. (Old Tax Regime)
₹ 25,000 p.a. if assessee opts for Section 115BAC (New Tax Regime)

## Exemption (Special Case)

Family pension received by widow / children of a member of the Armed Forces or Para-Military Force killed in operations is fully exempt under Section 10(19).

Worked example

### Example 1

Example 1 (Old Regime): Mrs. Sharma received family pension of ₹ 60,000 during P.Y. 2025-26. 1/3 × 60,000 = ₹ 20,000; ceiling = ₹ 15,000. Deduction = ₹ 15,000 (lower). Taxable Family Pension = ₹ 45,000.

### Example 2

Example 2 (New Regime u/s 115BAC): Same facts. 1/3 × 60,000 = ₹ 20,000; ceiling = ₹ 25,000. Deduction = ₹ 20,000 (lower). Taxable Family Pension = ₹ 40,000.

### Example 3

Example 3 (Armed Forces): Mrs. Rao received family pension of ₹ 5,00,000; her husband (army officer) died in operational duty. Fully Exempt under Section 10(19). Taxable = NIL.

⚠️ Common exam mistakes

Taxing family pension under "Salaries" — it goes under IFOS.
Applying ₹ 15,000 ceiling under New Regime — under 115BAC, the ceiling is ₹ 25,000.
Forgetting the special exemption for family of Armed Forces personnel.
Computing the deduction as 1/3 of pension only, ignoring the cap.

Bare-Act text Section 57(iia) · Income Tax Act, 1961 · click to expand

Section 57(iia): In the case of income in the nature of family pension, a deduction of a sum equal to thirty-three and one-third per cent of such income or ₹ 15,000 (₹ 25,000 if assessee opts for sec 115BAC), whichever is less, shall be allowed.

Now that you've read this — what's next?

Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.

🔥 Drill 5 Qs on this → ✍️ Adaptive practice →

Family Pension - Deduction

Worked example

⚠️ Common exam mistakes