Business

What are tax-saving investments other than section 80C for seniors?


Taxpayers, especially the elderly, can choose a new tax regime for the 2022-2023 fiscal year or keep the existing system intact. From AY 2022–23, seniors who are 75 years of age or older and receive only pension and interest income from the account(s) they hold at the bank are exempt from paying ITR. For seniors aged 60 to under 80, the standard exemption ceiling is set at Rs. 3 lakhs, while super elderly citizens over 80 years old are exempted up to Rs. 50,000 per fiscal year. There are other options for taxpayers to reduce their income taxes, however, most taxpayers are aware of. $A deduction of Rs 1.5 lakh is allowed under Section 80C. According to an interview with Dr Suresh Surana, Founder, RSM IndiaHere’s how seniors can make tax-saving investments beyond section 80C, to reduce their tax burden.

Dr Suresh Surana said in addition to the benefit of deductions that can be claimed u/s 80C of the Income Tax Act 1961 (hereinafter referred to as the ‘IT Act’), every Senior Citizen can Consider the following tax planning tools or alternatives:

1. Contribute to the National Pension Scheme (NPS) to claim an additional deduction of Rs. 50,000 u/s 80CCD(1B)

The Pension Fund Development and Administration has increased the Maximum Age to Join the NPS to 65 years old, and accordingly an individual between 60 and 65 years old can also join the NPS and continue participating in the NPS until the age of 70. . Such elderly citizens can not only claim the deduction of the contribution for that NPS u/s 80C within the general cumulative limit of Rs. 150,000 pa but also claim an additional deduction of u/s 80CCD(1B) up to Rs. 50,000 in a Fiscal Year in excess of the combined deduction of Rs 1,50,000 per year

2. Existing deduction wrt Health insurance premium

Under the provisions of Section 80D of the IT Act, Resident Elderly Citizens can get a higher deduction up to Rs. 50,000 to pay health insurance premiums. Furthermore, Elderly Citizens over 60 years old not covered by Health Insurance, will be allowed to deduct Rs. 50,000 towards actual medical expenses.

Elderly citizens may also consider claiming a deduction (if relevant) in writing as follows:

1. Deduction for certain medical conditions

Section 80DDB of the IT Act provides resident individual taxpayers with a claim to deduct the amount actually paid for medical treatment for a specific disease (such as dementia, Parkinson’s, cancer, or cancer). malignancy, etc.) for the taxpayer himself or a dependent relative (spouse, child, parent, sibling). Such deduction for one fiscal year is for the elderly and shall be limited to the actual expenditure incurred or Rs. 1,00.000, whichever is lower, and is only permitted in the case of illness has been certified by the competent health authority according to regulations. Furthermore, it should be noted that any claims received by such elderly citizens must be deducted from the deductible claim amount.

2. Deductions for people with disabilities

With increasing age, the elderly are often prone to different diseases and can be disabled as a result of the same. Such elderly citizens with specific disabilities can get a fixed deduction every year Rs. 75,000 for normal disability and Rs. 1,25,000 for severe disability, based on the degree of disability certified by the medical facility.

3. Donate to an organization or charity

Elderly people may be more inclined to donate to charity. However, donations to approved charities may be considered a u/s 80G deduction by the IT Act. Such a designated list of approved organizations may include the PM National Relief Fund, Defense Fund, Military Foundation, Registered Public Charity Foundation, etc. Such deduction shall be permitted for with 50% or 100% of the donation made (with or without eligibility limit) depending on the organization/organization to which the donation was made.

4. Deduct certain interest income

Seniors can claim the deduction of u/s 80TTB of the IT Act on interest on deposits at a banking company, cooperative association and Post Office in the amount of up to Rs. 50,000 in a particular financial year. It should be noted that such a deduction is available to the elderly not only for savings account interest, but also for term deposit interest.

In addition to the above, Section 194P of the Income Tax Act 1961 allows Resident Elderly Citizens over the age of 75 to be exempt from filing income tax returns provided that the Elder Citizen has only pension income and interest income & accrued/earned interest income from the same nominated bank in which he is receiving his pension.

Disclaimer: The views and recommendations expressed above are those of individual analysts or brokerage firms, not those of Mint.

catch them all Business newsletter, Market News, Hot news Events and Latest news Update on Live Mint. Download Mint News Application to get Daily Market Updates.

Than
Less than

news5s

News5s: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, Sports...at the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button