In the hailing period of governing bodies, the government of India and its authoritative bodies have made the process of online ITR filing, saving, and investment criteria a bit better and satisfactory.
Especially for senior and super senior citizens, the laws and rules regarding income tax filing, exemptions or deductions are slightly different but favourable yet beneficial compared to individual or HUF categories.
We know that India’s history hails and recognizes from a culturally enriched background where elders are paid respect, love, and gratitude. Following the same the government has also recognized and seen the importance of one who cared for us hence easing out the financial burden of those in their retirement years.
Considering the budget proposal of 2019 and 2020, both of which have introduced several changes that offer tax benefit to senior citizens as well as super senior citizens along with health protection.
Today in this blog, I will discuss the five special income tax benefits for senior citizens. Keep reading…!
5 Special Income Tax Benefits for Senior Citizens
I am sharing some of the major deductions and benefits which may ease out financial responsibilities for senior citizens.
- Medical Insurance Exemptions
Out of several sections, there is section 80D which talks about the medical coverage and deductions, for senior citizens there is a benefit on account of payment of the health insurance premium up to Rs.50,000.
On the other hand, for super senior citizens, the deduction for the payment of medical premium as well as the actual expenses incurred on their treatment are allowed.
- The Elementary Exemption Benefit
Do you know? Every person who is liable and falls under the tax slab bracket to pay tax is allowed for some elementary waivers.
This also happens in the case of senior citizens, the government has set up this basic exemption limit up to Rs.3 lakhs. If it’s between Rs 3 lakh - 5 lakh slab, then they will have to pay a tax of 5%.
But, the super senior citizens enjoy the higher benefits, considering their age and income, the waiver is of up to Rs.5,00,000 in one financial year.
- Privilege on Interest Income
Apparently, income tax doesn’t only surge to your income from salary but also from other sources like interest income earned from property or selling shares etc. For senior citizens they enjoy interest free advantage i.e. they don’t have to pay tax on interest earned up to Rs. 50,000/- for one financial year.
- No Advance Tax
Advance Tax is an amount paid in advance to the Indian Government which all citizens are bound to pay. Considerably, ordinary individuals have to pay an advance tax if their tax liability is Rs.10,000/- or more in a financial year, but senior citizens are free from such tension unless and until their income is generated from business or profession.
- Allowance on the treatment of specified diseases
Both for ordinary taxpayers and senior citizens, the government paid an allowance which is a good thing for taxpayers. For ordinary citizens allowance is to not pay tax if the cost of treatment is somewhere to Rs. 40,000/-
While under section 80DDB of the Income Tax, senior citizens get a deduction limit of Rs.1 lakh, in case, if they undertake any treatment for specified diseases/illness in a financial year.
Other benefits provided by the government of India to the senior citizens are:
- Super Senior Citizens (individuals above 80 years) can file for their Income Tax Return through either Sahaj (ITR 1) or Sugam (ITR 4) through any mode i.e. electronically or manually.
- Senior citizens are allowed a standard deduction of ₹50,000 on account of their pension income.
- No tax under the Reverse Mortgage Scheme.
Income Tax Slabs for Senior Citizens - FY 2019-20
A taxpayer is said or classified to be a ‘senior citizen’ if she/he is above the age of 60 years and below 80 years.
| Income tax slabs | Rate of tax | Health & Education Cess |
| Income up to ₹3 lakh* | No tax | NA |
| Income between ₹3 lakh and ₹5 lakh | 5% | 4% of income tax |
| Income between ₹5 lakh and ₹10 lakh | 20% | 4% of income tax |
| Income that exceeds ₹10 lakh | 30% | 4% of income tax |
Income Tax Slabs for Super Senior Citizens - FY 2019-20
A taxpayer is said or classified to be a ‘super senior citizen’ if she/he is more than the age of 80 years.
| Income tax slabs | Rate of tax | Health & Education Cess |
| Income up to ₹5 lakh* | No tax | NA |
| Income between ₹5 lakh and ₹10 lakh | 20% | 4% of income tax |
| Income that exceeds ₹10 lakh | 30% | 4% of income tax |
Note: 10% surcharge if total income is more than Rs.50 lakh and up to Rs.1 crore. Moreover, 15% surcharge if total income exceeds Rs.1 crore.
Require assistant in ITR filing process or anything? Get the best Income tax return consultant from a TaxWink expert.
