Senior residents vs tremendous senior residents: Income tax advantages in contrast

A resident Indian who’s 60 years of age or older is taken into account a senior citizen, whereas a resident Indian who’s 80 years of age or extra is taken into account an excellent senior citizen at any level throughout the pertinent monetary 12 months. For these residents, there are revenue tax advantages accessible below fee of advance tax, normal deduction, deductions below medical insurance coverage premiums, deduction for curiosity earned from financial institution and publish workplace, and rather more. The revenue tax advantages for senior residents and tremendous senior residents are subsequently contrasted beneath by a number of business specialists.

Suresh Surana, Founder, RSM India

The provisions of the Income Tax legislation offers sure advantages to senior residents equivalent to larger fundamental exemption threshold, larger thresholds for claiming deductions, and many others. While sure advantages are widespread for each senior residents in addition to tremendous senior residents, sure provisions present for a better profit to tremendous senior residents as in comparison with senior residents. We have mentioned such tax advantages supplied to senior residents in addition to tremendous senior residents within the beneath desk:

Sr. NoSenior CitizensSuper senior citizens1.Meaning A resident particular person shall be handled as senior citizen as soon as he/she attains the age of 60 years or extra at any time throughout the monetary 12 months.A resident particular person shall be handled as tremendous senior citizen as soon as he/she attains the age of 80 years or extra at any time throughout the monetary 12 months.2. Basic exemption restrict below previous tax regime Under previous tax regime, resident senior citizen will get a fundamental exemption of Rs. 3,00,000, that’s revenue as much as Rs. 3,00,000 shall be exempt from tax.Under previous tax regime, resident tremendous senior citizen will get a fundamental exemption of Rs. 5,00,000, that’s revenue as much as Rs. 5,00,000 shall be exempt from tax. 

It is pertinent to notice that any resident particular person with taxable revenue as much as Rs.5,00,000 shall be eligible to say a rebate u/s 87A below IT Act.

 However, such fundamental exemption restrict additionally decided whether or not the taxpayer can be required to furnish their revenue tax return u/s 139 of the IT Act i.e. as soon as the fundamental exemption threshold is exceeded, the taxpayer can be mandatorily required to furnish their tax returns.

3.Option to furnish Paper return v/s E-Filing of Return of Income Senior Citizens can be mandatorily required to furnish their tax returns on-line on the e-filling portalSuper senior residents have an choice to file the income-tax return in paper mode of their jurisdictional tax workplace, supplied the return is being filed in ITR 1 (Sahaj) and ITR 4 (Sugam). The above talked about advantages differed for each senior residents and tremendous senior residents. We hereinbelow focus on the same advantages for each senior residents in addition to tremendous senior citizens4.Interest deduction u/s 80TTB of IT Act 

According to part 80TTB of IT Act, any resident senior citizen following previous regime can declare a deduction as much as Rs. 50,000 in opposition to following talked about revenue:

–          Interest on financial savings account and glued deposits

–          Interest on deposits held in co-operative society

–          Interest on publish workplace deposits

5.Enhanced Deduction u/s 80D on Health protection and Medical expenditure 

Deduction below part 80D of IT Act might be claimed by each resident and non-resident people with respect to Mediclaim premium, preventive well being check-up or contribution to the central authorities well being scheme.

·       The next restrict of Rs. 50,000 might be claimed in case such premium is paid for any senior citizen.

·       However, senior residents can declare a most deduction of Rs. 50,000 below this part with respect to any medical expenditure incurred supplied no mediclaim premium is paid by such senior citizen.

6. Enhanced Deduction u/s 80DDB for Medical Treatment of specified illnesses 

Deduction u/s 80DDB of the IT Act might be claimed by resident people for bills incurred with respect to medical remedy of such illnesses or illnesses as laid out in Rule 11DD of IT Rules, 1962.

The quantum of deduction below this part shall be Rs. 1,00,000 for senior residents (versus Rs. 40,000 for aside from senior residents) or precise bills incurred whichever is decrease.

7.Relief from Payment of Advance tax An particular person with tax legal responsibility exceeding Rs. 10,000 is required to advance tax in accordance with Section 208 of the IT Act. However, a resident senior citizen wouldn’t be required to pay any advance tax even when his/her tax legal responsibility exceeds the above-mentioned threshold, supplied they aren’t deriving any income from enterprise or occupation.8.Filing of Form 15H for Non deduction of TDS Section 197A of IT Act permits a resident senior citizen to obtain sure specified revenue with out deducting tax on similar. In order to say such profit, the stated individual will likely be required to make a self-declaration in Form 15H to the tax deductor that their tax legal responsibility on their estimated revenue throughout the 12 months is NIL.9.Exemption from return submitting below part 194P of IT Act Section 194P of IT Act exempts resident senior residents aged 75 years and above from submitting revenue tax returns supplied that such senior citizen derived solely pension revenue and curiosity revenue & such curiosity revenue accrued / earned from the identical specified financial institution by which he’s receiving his pension.
Siddharth Singhal, Business Head – Health Insurance, Policybazaar.com

According to Section 80D of Income Tax Act, one can avail tax advantages in opposition to the price incurred to buy well being or important sickness insurance coverage. The most deduction allowed below this part is Rs. 25,000 for self, partner, and dependent kids. However, if one or each mother and father are above 60 years of age or senior residents, the utmost tax deduction allowed is Rs. 50,000.

Also, if senior citizen pays premium for self and their members of the family together with mother and father i.e. all above 60 years of age, they’re eligible to say as much as Rs. 1,00,000. Similarly, Section 80D additionally permits the policyholder to say tax advantages for preventive well being check-ups of ₹5,000 i.e. inclusive on this restrict of Rs. 25,000 or Rs. 50,000.

Manu Rishi Guptha, Founder of MRG Capital

There isn’t any distinction between the tax charges for Senior residents (60-80 years of age) and Super senior residents (80+ years) within the previous tax regime. The distinction is just within the fundamental exemption restrict. While the Super senior citizen will get an exemption of as much as 5 lakhs rupees, the exemption is 3 lakhs for a senior citizen. An excellent senior citizen needn’t pay tax or file returns if his revenue doesn’t exceed 5 lakh rupees. But within the new tax regime, there isn’t a separate exemption restrict for senior or tremendous senior residents. Both get ₹2.5 lakhs as a fundamental exemption like a standard taxpayer.

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