Income earned through such avenues is still taxable under
Section 80C of the Income Tax Act. According to a Central Board of Direct Taxes (CBDT) directive, cases of senior citizens cannot be scrutinised unless an assessment is necessary on the basis of credible information,
Bankbazaar.com said.
Finance minister Piyush Goyal in the
interim budget announced the following tax deduction limits and benefits for the senior citizens:
No tax will be applicable to senior citizens within the age bracket of 60-80 years if the total income does not exceed Rs 3 lakh.
Five percent tax will be applicable if the total income exceeds Rs 3 lakh, but not Rs 5 lakh.
Rs 10,000 with plus an additional 20 percent if the total income exceeds Rs 5 lakh, but not Rs 10 lakh.
Rs 1,10,000 plus 30 percent tax if the total income exceeds Rs 10 lakh.
No tax will be applicable to the total income of Rs 5 lakh, in case of senior citizens who are 80 years or older.
20 percent of tax applicable to the total income exceeding Rs 5 lakh, but not more than Rs 10 lakh.
Rs 1,00,000 plus 30 percent where the total income exceeds Rs 10 lakh.According to Bankbazaar.com, under Sections 80D and 80DDB, senior citizens can also avail tax deductions of up to Rs 50,000 on the medical insurance premium and Rs 1 lakh for medical treatment of certain critical ailments. Under the Varishtha Bima Yojana, senior citizens need not pay service tax on the premium.
They can also avail a 50 percent exemption on interest income for banks and post-office deposits (including fixed deposits and recurring deposits). Short-term capital gains are also exempted from tax if the basic limit at 15 percent is not exceeded. Under section 80L, senior citizens can avail tax exemptions on interest up to Rs 12,000 per annum.
As per Bankbazaar.com, here's how senior citizens can file for income tax:
Like any other individual with a taxable income, senior citizens are also required to file their income tax return to claim their tax refund.
ITR I – Individual whose total Income Includes:
Salary or pension.
Income from house or property (excluding incidents where the loss is brought forward from previous financial years).
Income from the other sources (excluding income from horse racing or winning lottery).ITR 2 – Individual whose total Income Includes:
Salary or pension.
Income from house or property.
Capital gains.
Income from the other sources (includes winning from horse racing and lottery).
Incidents where the income of another individual, such as a spouse or other member has to be combined with the income of the individual.First Published: Feb 15, 2019 2:50 PM IST
