Benefits for the senior citizen of our country. It is safe to say that one section of the country that has the most to cheer for after the Annual Budget is those aged 60 years and above. Once he attains 60 years, his status as a senior citizen in that financial year gives him some relief. There are not many income tax exemptions available for senior citizens.
These are listed below:
Senior citizens and a very senior citizen are granted a higher exemption limit as compared to normal taxpayers. Exemption limit is the quantum of income up to which a person is not liable to pay tax.
Senior citizen: A senior citizen is granted a higher exemption limit compared to non-senior citizens. The exemption limit for the financial year 2019-20 available to a resident senior citizen is Rs. 3,00,000. The exemption limit for non-senior citizen is Rs. 2,50,000. Thus, it can be observed that an additional benefit of Rs 50,000 in the form of a higher exemption limit is available to a resident senior citizen as compared to normal taxpayers.
Very senior citizen: A very senior citizen is granted a higher exemption limit compared to others. The exemption limit for the financial year 2019-20 available to a resident's very senior citizen is Rs. 5,00,000. The exemption limit for non-senior citizen is Rs. 2,50,000. Thus, it can be observed that an additional benefit of Rs. 2,50,000 in the form of a higher exemption limit is available to a resident very senior citizen as compared to normal taxpayers.
Aggregate deduction on a. or b. above cannot exceed Rs. 50000
Section 194A of the Income Tax law gives corresponding provisions that no tax shall be deducted at source from payment of interest to a senior citizen up to Rs.50000.
From the assessment year 2017-18 onwards any taxpayer filing return of income in Form ITR 1/4 and having a refund claim in the return or having total income of more than Rs. 5,00,000 is required to furnish the return of income electronically with or without digital signature or by using electronic verification code. However, Income-tax Law grants relaxation from e-filing in the above case to very senior citizens.
Every person whose estimated tax liability for the year is Rs. 10,000 or more, shall pay his tax in advance, in the form of “advance tax”.
Senior citizens receive a higher interest (up to 50 bps) on a 5-year fixed deposit, which is eligible for deduction from the total income under Section 80C. Senior citizens can claim an exemption on the tax deducted at source (TDS) on interest income earned on deposits. It can be done by submitting Form 15H under Section 197 of the IT Act.
7. Senior citizens recieve a higher interest (up to 50 bps) on a 5- year fixed deposit, which is eligible for deduction from the total income under section 80C
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