7 special income tax benefits for senior citizens

Various Tax-Slab Rates

Income tax The slab rates for senior citizens are different as compared to non-senior citizens.

interest income exemption 50,000

CA Amit Gupta, MD, CAG Infotech said section 80TTB has come into action from FY 2018-19 which allows deduction for interest 50,000 plus amount earned 50,000 to be taxed as per specially designed slab rates senior citizen, However, it is important to note that in such cases the deduction under section 80TTA will not be 10,000 for interest on savings account.

Deduction under section 80D for medical insurance premium payment

Section 80D allows non-senior citizens to deduct

25,000 on medical insurance premium paid, although for senior citizens, this increases to . It happens 50,000 “was the limit” 30,000 earlier but increased to this in budget 2018 50,000 Further, Section 80D allows deduction not only for medical insurance premium payment but also for actual expenditure incurred on treatment by very senior citizens,” said Gaurav Kapoor, Director and Co-Founder, Fincorpit Consulting.

TDS not deducted on interest

If the total income of a senior citizen is exempted from income tax and nil tax is payable by him for that financial year, he can submit Form 15H for non-deduction of TDS on interest on fixed deposits.

Additionally, with the amendments made through Budget 2018, the tax deduction limit under section 194A for senior citizens has also been increased. from 10,000 50,000, said Amit Gupta.

Higher deduction under section 80DDB for specified illness

Section 80DDB provides tax deduction relief to taxpayers in case of expenditure on medical treatment of specified diseases. previously allowed deduction was 60,000 for senior citizens, but budget 2018 increased it 1,00,000.

Advance tax is not required to be paid

Senior citizens without any business income are exempted from paying advance tax and will have to pay self-assessment tax only on their total income.

No tax on amount received under reverse mortgage scheme

With a reverse mortgage plan, senior citizens get regular payments by mortgaging their home for life while the ownership and possession remains with the senior citizen. Under this scheme, on the death of the borrower, the loan is repaid along with the interest earned through the sale of the property and the balance amount received on the sale is transferred to the legal heirs. The amount paid in installments to senior citizens under this scheme is completely exempt from income tax.

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