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ABCAUS Excel for Chartered Accountants

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Chartered Accountants

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Senior Citizen As per Income Tax Act, a senior citizen has been defined as an individual resident in India who is of the age of sixty years or more at any time during the relevant previous year.

Super Senior Citizen As per Income Tax Act, a senior citizen means an individual resident in India who is of the age of Eighty years or more at any time during the relevant previous year.

Example: The following table illustrates the senior citizen status of a person (Say Mr. A)

Date of Birth

FY in which age is 60Y or more

FY in which age is 80Y or more

Assessment Year in which entitled for the benefit of:

Senior Citizen

Super Senior Citizen

01-04-1953

2013-14

2033-34

2014-15

2034-35

31-03-1954

2013-14

2033-34

2014-15

2034-35

01-04-1954

2014-15

2034-35

2015-16

2035-36

31-03-1955

2014-15

2034-35

2015-16

2035-36

31-03-1934

1993-94

2013-14

-

2014-15

31-03-1935

1994-95

2014-15

-

2015-16

Thus the cut-off date of birth for qualifying as senior citizen for various assessment years is as under:

Cut Off Date

Senior Citizen

Super Senior Citizen

31-03-1954

AY 2014-15

-

 

31-03-1955

AY 2015-16

-

 

31-03-1956

AY 2016-17

-

 

31-03-1935

-

AY 2015-16

 

31-03-1936

-

AY 2016-17

 

and so on.

Tax Benefits available to senior citizens:  Click to see changes made by Budget 2015-16 >>

The various relaxation, reliefs and benefits bestowed upon the senior citizens are as under:

1. Higher Tax Exemption Limits:
Seniorcitizen or super senior citizen is entitled to higher tax exemption limits against normal citizen. For AY 2015-16 and AY 2016-17 the basic income tax exemption limit for the both is as under:
Senior Citizen                       Rs. 300000/-
Super Senior Citizen             Rs. 500000/- 

2. Increased Deductions under Chapter VIA
A senior citizen or super senior citizen is entitled to higher deductions under the following sections of Chapter VIA of Income Tax Act.

    (a) Deduction in respect of Senior Citizen Saving Scheme [ Section 80C ]
Under section 80C a deduction up to Rs. 150000/- (One lakh) is allowed for amount paid or deposited in specified modes. wef 01-04-2008, an amount deposited in an account under the Senior Citizens Saving Schemes Rules, 2004 is allowed as qualified under section 80C. 

(b) Deduction in respect of Medical treatment etc. [ Section 80DDB ]
Section 80DDB provides for a deduction of Rs. 40000/- ( Forty thousand) to a resident assessee for medical treatment of disease specified in Rule 11DD. However if the amount is paid for the medical treatment of a senior citizen, then a higher deduction of Rs. 60000/- (Sixty Thousand) is allowed. For AY 2016-17 the limit is Rs. 80000/- for super senior citizen.

    The diseases specified under Rule 11DD are as under:
(i)       Neurological Diseases as under where the disability level has been certified to be of 40% and above,
         (a) Dementia
         (b) Dystonia Musculorum Deformans 
         (c) Motor Neuron Disease 
         (d) Ataxia
         (e) Chorea
         (f)  Hemiballismus
         (g) Aphasia
         (h) Parkinsons Disease 
(ii)       Malignant cancer
(iii)      Full Blown Acquired Immuno-Deficiency Syndrome
(iv)      Chronic Renal Failure
(v)       Haematological Disorders
          -     Hemophilia
          -     Thalassaemia

(c) Deductions in respect of health insurance premia [ Section 80D ]
Section 80D provides for a deduction up to Rs. 15000/- (Fifteen Thousand) for medical insurance or preventive health check-up. Under the section, in  case of payment made for medical insurance of a senior citizen,deduction is available up toRs. 30000/- (Twenty Thousand).

3.  Exemption to pay Advance Tax under Section 207
As per section 209, where the income tax payable by an assessee for any financial year (after deducting tax deducted at source) is Rs. 10000/- or more, the tax shall be payable in advance duringthe financial year itself. However senior citizens have been exempted for payment of advance tax if they are not engaged in business or profession.

4.  No Deduction of Tax at Source (TDS) by submission of Form 15H in certain cases.
A resident senior citizen can receive certain incomes (interest,furnish a declaration under sub-section (1C) of section 197A to his Assessing Officer in Form 15-H stating that tax on his estimatedtotal income of the previous year in which such incomes is to be included in computing his total income will be nil.Senior citizens can give this declaration even if such incomes exceed the maximum amount which is not chargeable to tax.(i.e., Rs. 300000/- and Rs. 500000/- for senior citizens and super senior citizens respectively)  Read More +Download Form 15H >>

5.  Reverse Mortgage Scheme – Section 47
The Finance Minister in his Union Budget 2007-08 had announcedthat the National Housing Bank (NHB) will introduce reverse Mortgage Scheme for senior Citizens. As of now, almost all the banks have come up with this scheme. Reverse mortgage is a scheme under which a senior citizen of the age of 60 years or more who is the owner of a house can avail of a monthly stream of income against the mortgage of his/her house, while remaining the owner and occupying the house throughout his/her lifetime, without repayment or servicing of the loan. On the borrower's death or on the borrower leaving the house property permanently, the loan is repaid along with accumulated interest, through sale of the house property.  Section 47 of the Income Tax Act, 1961 has been amended to provide that mortgage of house property for obtaining a loan under reverse mortgage shall not be considered a transfer of house property and accordingly shall not attract capital gain tax. Further section 10 of the IncomeTax Act, 1961 has also been amended to provide that any amount received as a loan under reverse mortgage scheme shall not be included in the income.  Read More on Reverse Mortgage Scheme >>

Benefits, Rebates and Deductions available to Senior Citizens or Super Senior Ctizens under Income Tax Act 1961

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