Many pensioners often wonder whether disability pension is still exempt under the new income tax rules and e-filing system. Let us clarify—disability pension exemption is very much applicable, and the belief that it is not is completely incorrect.
Below is the step-by-step process to file your Income Tax Return (ITR) correctly while claiming disability pension exemption. It is important that you follow these steps carefully and do not include your any part of pension under total income, except under the Exempted Income section (after B3).
✅ Step-by-Step Instructions:
Step 1:
Log in to the Income Tax e-filing portal using your PAN number and password.
Step 2:
Select the appropriate Assessment Year and choose your mode of filing (Online or Offline).
Step-3 : Select form ITR 1 , 2, 3 or 4 whichever is applicable.
Step-4 : In this Return summary select personal information and then select New or Old Regime whichever is applicable
Step 5 : You will find this section after personal information – Gross total Income – B1 Income From salary. At this section do not include your Pension , if you are drawing disability pension or invalid pension or impairment relief.
Step 6 : You will find this sections after Gross total Income. At this section you may put your Home loan interest , if exist.
Step 7 : You will find these sections after Income from house property. If applicable, may open these or scroll to next.
Step 8 : After B3 Section you will find Exempt Income Section . Now click on the Exempt Income heading. You will find a list of exempted income. Now select Defence Medical disability pension as shown in the next slide.
Step – 9 : Now put your total pension amount here only. Do not include this amount at any other section in the entire ITR Form.
Step 10:
Review your entries thoroughly, especially the breakdown between taxable and exempt income.
Step 11:
Complete the verification and submit your ITR.
Key Tips:
- This exemption is valid under both old and new tax regimes.
- Do not add the exempted disability pension under total income or salary.
- Keep records like PPO, medical board proceedings, or PCDA circular references handy in case of future queries from the IT Department.
