India’s income tax law provides several tax benefits for senior citizens. A resident Indian who is 60 years of age or older is considered a senior citizen. Only residents of the country can avail of these special benefits. For these citizens, there are income tax benefits available under payment of advance tax, standard deduction, deductions under medical insurance premiums, deduction for interest earned from bank and post office, and more.
In the old tax regime, the exemption limit is ₹3 lakh for a senior citizens and ₹5 lakh for super senior citizens (80 years and above). But in the new tax regime, there is no separate exemption limit for senior or super senior citizens. Both get ₹2.5 lakhs as a basic exemption like a normal taxpayer.
“Senior citizens enjoy all the tax benefits available to non-senior taxpayers. Additionally, where senior citizens opt for the old regime, they can get a higher basic exemption limit, ₹3L for those between 60-80 and ₹5L for those above 80 years of age,” said Archit Gupta, Founder, and CEO, Clear.
Besides they can opt for higher medical insurance premium deductions under Section 80D. An exemption under section 80TTB for interest income.
According to Section 80D of the Income Tax Act, one can avail of tax benefits against the cost incurred to purchase health or critical illness insurance. The maximum deduction allowed under this section is ₹25,000 for self, spouse, and dependent children. However, if one or both parents are above 60 years of age or senior citizens, the maximum tax deduction allowed is Rs. 50,000.
“If senior citizen pays a premium for themselves and their family members including parents i.e. all above 60 years of age, they are eligible to claim up to ₹1 lakh Similarly, Section 80D also allows the policyholder to claim tax benefits for preventive health check-ups of ₹5,000 i.e. inclusive in this limit of ₹25,000 or ₹50,000,” said Siddharth Singhal, Business Head – Health Insurance, Policybazaar.com, Mint reported.
Senior citizens must take benefit from all of these provisions. As per Archit Gupta sometimes, their income may not be within the taxable limit, yet some TDS may have been deducted, in such a case they must file an ITR and claim a refund of excess TDS deducted.
Source By: livemint
