NSC Interest Tax (2026): Is Interest on National Saving Certificate Taxable? 80C Reinvestment Rule & Section 123
NSC pays 7.7% for 5 years. Interest on a National Saving Certificate is taxable every year as Income from Other Sources – but years 1-4 interest can be offset with a matching 80C (Section 123) deduction. Year 5 interest is fully taxable.