Senior Citizens: These are the income tax benefits available to senior citizens in the financial year 2025-26.
Senior Citizens: Adjusting to a steady source of income to meet the rising costs of living in India is a challenge. The taxation system provides certain benefits to reduce the financial stress of senior citizens.
Who is a senior citizen?
In India, the Income Tax Department considers those above 60 years of age as senior citizens and those above 80 years of age as super senior citizens.
For senior citizens,
The Income Tax Act, 1961 provides certain tax benefits to senior and very senior citizens to help them as they age. they are..
exclusion limit
The maximum amount of exemption from income tax is higher for senior citizens as compared to general citizens. For ordinary citizens below 60 years of age, this tax is Rs. Rs 2.5 lakh, while the exemption limit for senior citizens will be Rs 3 lakh. Also for super senior citizens it will be Rs 5 lakh.
Tax exemption on medical expenses
Medical expenses form a significant part of the expenses of the elderly. Therefore the IT Act provides certain benefits on medical expenses of senior citizens. they are
- Under Section 80D, a tax deduction of up to Rs 50,000 is available on health insurance premiums paid within that year.
- According to Section 80D of the IT Act, there is a tax deduction of up to Rs 25,000 for general citizens and Rs 50,000 for senior citizens on premiums paid on health insurance in a financial year.
- Uninsured senior citizens (above 60 years) can also claim exemption on medical expenses exceeding Rs 50,000 for medical treatment.
- According to Section 504 of the IT Act, senior citizens can claim tax deduction of up to Rs 1 lakh on expenses incurred for the treatment of listed major diseases.
tax exemption on savings
There is tax exemption on interest earned from savings accounts, fixed and recurring deposit accounts for senior citizens. It is beneficial for those citizens who depend only on interest income.
- Senior citizens are given special benefits under Section 80TTB. It provides an opportunity to avail deduction of up to Rs 50,000 on interest earned from savings accounts, fixed deposits, recurring deposit accounts.
other tax exemptions
Senior citizens also get tax exemption, which is refunded if the tax amount paid exceeds. Under Section 87A, senior citizens whose annual income does not exceed Rs 5 lakh will get tax exemption of up to Rs 12,500.
no advance tax
If senior citizens do not have business or professional income, they are not required to deposit advance tax. This provision of taxation will help in reducing the financial pressure on them.
income tax return
As per the IT Act, senior citizens above 75 years of age are not required to file income tax returns if they receive pension income and interest from the same bank after submitting the declaration under Form 12BB.
Tax Benefits on Personal Loan
- Senior citizens who take personal loans for certain needs can get tax exemption. Taxpayers can claim deduction on account of loan taken for purchase, construction, repair, renovation or renovation of property under the Income Tax Act 1961.
- Personal loans taken for business and investment purposes offer certain tax benefits to senior citizens to meet business expenses.
