Filing Income Tax Returns (ITR) is crucial for senior citizens to ensure compliance and take advantage of available benefits and exemptions. In this blog, we will cover the benefits and exemptions available to senior citizens in India when filing their ITR.
1. Higher Basic Exemption Limit
Senior citizens (aged 60 to 80 years) enjoy a higher basic exemption limit of INR 3 lakh, compared to INR 2.5 lakh for individuals below 60 years. For super senior citizens (aged 80 years and above), the exemption limit is INR 5 lakh.
2. Exemption from Advance Tax
Senior citizens not having income from business or profession are exempt from paying advance tax. They can pay their entire tax liability through self-assessment tax before filing their ITR.
3. Higher Deduction for Health Insurance Premiums (Section 80D)
Senior citizens can claim a higher deduction of up to INR 50,000 for health insurance premiums paid for self, spouse, and dependent children. An additional deduction of INR 50,000 is available for premiums paid for parents.
4. Deduction for Medical Expenses (Section 80DDB)
Under Section 80DDB, senior citizens can claim a deduction of up to INR 1 lakh for medical treatment of specified critical illnesses for self or dependents. The deduction amount is reduced by any reimbursement received.
5. Tax Benefits on Interest Income (Section 80TTB)
Senior citizens can claim a deduction of up to INR 50,000 on interest income from savings accounts, fixed deposits, and recurring deposits under Section 80TTB. This is in addition to the basic exemption limit.
6. No TDS on Interest Income
Banks and financial institutions are not required to deduct TDS on interest income of up to INR 50,000 earned by senior citizens. This helps in reducing the hassle of claiming refunds.
7. Claiming Standard Deduction on Pension
Senior citizens receiving pension income can claim a standard deduction of INR 50,000 from their pension income, similar to the deduction available to salaried individuals.
8. Filing and Verifying ITR for Senior Citizens
Senior citizens can file their ITR using the appropriate forms (ITR-1 or ITR-2). The filing process is similar to that for other individuals, and they can verify their ITR electronically using Aadhaar OTP, net banking, or by sending a signed physical copy to the CPC.
How We Can Help
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Conclusion
Filing ITR is essential for senior citizens to ensure compliance and take advantage of available benefits and exemptions. By understanding and claiming all eligible provisions, senior citizens can maximize their tax savings and improve their financial health.
For professional assistance and expert guidance, visit Our Tax Partner. We are here to help you navigate the complexities of income tax filing and ensure a smooth and hassle-free experience.
