Income Tax laws have special benefits for senior citizens under the provisions of its various sections. According to the Income Tax (I-T) department, the senior and very senior citizens are granted a higher exemption limit as compared to the other tax payers. The exemption limit is basically the quantum of income up to which a person is not liable to pay the tax. People who are older than 60 years of age are considered senior citizens. The income tax department offers special benefits to both senior and very senior citizens. (Also Read: ITR Filing: Important Due Dates To Keep In Mind For Filing Your Income Tax Return )
Here are all of the special income tax benefits for senior citizens, according to the income tax department:
- According to section 208, 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. However, section 207 provides relief from payment of advance tax to a resident senior citizen.
- According to section 207, a resident senior citizen who does not have any income from business or a profession is not liable to pay advance tax.
- Section 80TTB of the income tax law provides provisions relating to tax benefits available on account of an interest income from deposits with banks/post office/co-operative banks of an amount upto Rs. 50,000 earned by the senior citizen. The interest earned on saving deposits and fixed deposit, both are eligible for deduction under this provision.
- Section 194A of the income tax law gives corresponding provisions that no tax will be deducted at the source from payment of interest by bank or post-office or a co-operative bank to a senior citizen up to Rs. 50,000. So the limit is to be computed for every bank individually.
- Section 80DDB of the I-T law provides various provisions relating to the tax benefits available on account of expenditure on medical treatment of specified diseases, whereas, section 80D provides provisions relating to tax benefits available on account of payment of medical insurance premium and other related items.