Does a Worker Enjoy any Tax Reliefs for Contributing Under the National Pensions Act?

Does a Worker Enjoy any Tax Reliefs for Contributing Under the National Pensions Act?

Yes, a contributor under the National Pensions Act enjoys the following tax benefits: a) An employer or employee shall not pay income tax in respect of contributions to the basic national social security scheme and mandatory occupational pension schemes b) Contributions not exceeding sixteen and one half per centum of a contributor’s monthly income, made […]

Yes, a contributor under the National Pensions Act enjoys the following tax benefits:

  1. a) An employer or employee shall not pay income tax in respect of contributions to the basic national social security scheme and mandatory occupational pension schemes
  2. b) Contributions not exceeding sixteen and one half per centum of a contributor’s monthly income, made by either a contributor or the contributor’s employer or both to a provident fund or personal pension scheme shall, be treated as tax deductible income, for the purpose of income tax for the contributor and the contributor’s employer to the extent of their respective contributions
  3. c) Tax is not payable on the benefits received under Act 766
  4. d) Investment income including capital gains from the investment of scheme funds shall for the purposes of income tax be treated as deductible income
  5. e) A withdrawal of all or part of a contributor’s accrued benefits under a provident fund or personal pension scheme on or after retirement shall be tax exempt

it shall, however, be subject to the appropriate income tax for contributors in the formal sector, who withdraw their benefits before ten years of contribution and before retirement.

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