Section 80DDB provides tax deduction to taxpayers in case of expenditure on medical treatment of specified diseases. The deduction limit is up to Rs 1 lakh for senior citizens (those in the 60-80 age group). The super seniors or those above 80 enjoy some more benefits.
Senior citizens enjoy a few more benefits compared to other taxpayers when it comes to income tax. Besides the income tax sops that are exclusively designed for senior citizens, the ITR e-filing process is also simpler for them.
As per the existing law, for income tax purposes a senior citizen is an individual resident between the age group of 60-80 years as on the last day of the previous financial year. Those who are above 80 years of age are called super senior citizens and they enjoy few more benefits.
Here are seven income tax benefits available to senior citizens.
Medical insurance benefits
Under Section 80D, senior citizens are offered a deduction of up to Rs 50,000 towards the payment of the health insurance premium.
Elementary exemption benefit
Individuals, who fall under the taxable income bracket, are allowed for some elementary waivers. However, for senior citizens, the government has given a basic exemption limit up to Rs 3 lakh and for the taxable between Rs 3-5 lakh, the tax rate is only 5 percent.
No payment of the advance tax is required
Senior citizens who do not own any business are exempted from the payment of advance tax and they only pay self-assessment tax on their total income.
Non-deduction of TDS on interest
In case the total income of a senior citizen is exempted from income tax and no tax is payable by him/her for that financial year, they can simply submit Form 15H for non-deduction of TDS on interest earned on fixed deposits.
Section 80DDB provides tax deduction to taxpayers in case of expenditure on medical treatment of specified diseases. The deduction limit is up to Rs 1,00,000 for senior citizens.
Interest income exemption of up to Rs 50000
Under Section 80TTB, senior citizens are allowed a deduction of a maximum of Rs 50,000 on interest earned from various savings.
Tax exemption under reverse mortgage scheme
If a senior citizen chooses to reverse mortgage any of his or her accommodations for the purpose of monthly earnings, then the amount paid in monthly installments to the owner (senior citizen) is exempted from income tax.
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