What is the tax treatment of the interest earned on NSC?

The interest earned or accrued on a National Savings Certificate (NSC) is taxable. For taxation purposes, it should be added to the taxable income of the investor every year (not just at the time of maturity) and taxed as per the applicable slab. One must show it under the head, 'Income from other sources' while filing their tax return. However, the interest accrued on NSC is automatically reinvested and added to the principal (original investment) every year. And the s

This article was originally published on May 19, 2022.