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T. Banusekar

WILL interest on National Savings Certificates (NSC) qualify for deduction under Section 80C?

V. Dundur

Reply

Under the NSC VIII issue, which is in operation now, the interest, except in the last year, is not paid but credited to the investor's account. The interest not paid is treated as invested in the NSC. Therefore, the interest so credited will qualify for deduction under Section 80C. However, in the last year of the investment, the interest will be paid to you and, therefore, will not qualify for Section 80C deduction.

Mail your queries to taxtalk@thehindu.co.in or by post to Tax Talk', Business Line, Kasturi Buildings, 859, Anna Salai, Chennai-600002.

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