Income Tax Return New Rule 2021, Tax Benefit for Senior Citizens

1. The tax department brings a bit of excellent news for senior citizens above 75 years of age. Now they don’t get to file ITR if they meet certain conditions. The Central government in its 2021-22 Budget had added a provision to exempt senior citizens of 75 years and above having pension income and interest from fixed deposits in the same bank from filing income tax returns for the financial year beginning April 1. As per the notice to the Budget 2021, "In order to provide relief to senior citizens who are of the age of 75 years or above and to reduce compliance for them. Income Tax Return New Rule 2021, Tax Benefit for Senior Citizens aged 75 and above This new relaxation was announced by the minister of finance Nirmala Sitharaman during the Union Budget 2021. “In the 75th year of Independence of our country, the government shall reduce the compliance burden on senior citizens who are 75 years aged and above. She said, for senior citizens who only have a pension and interest income, I propose exemption from filing their tax returns. The paying bank will deduct the required tax on their income. Why should Senior Citizens have other Income Tax benefits? India’s history hails from a culturally enhanced background where elders are given respect and love. The government working together to stay the culture and moral values intact offer special tax benefits for senior citizens. Their idea is to alleviate stress at this phase of life. If you or your senior citizen parents are planning their funds, then it's crucial to know about the tax benefits for senior citizens which will be availed.

2. Computation of Income Tax for Senior Citizens The tax for senior citizens is calculated based on the essential salary, house rent allowance, fixed allowances, and other sources of income. However, the senior citizen receives a higher exemption limit compared to individuals who are below 60 years old. In order to calculate the income tax for a senior citizen, all the income is taken into consideration alongside the allowable deductions and the income tax slab for FY 2020-21. Once you've got all the details, the calculator is often used to determine your taxable income. In the Union Budget 2020-2021, a new tax regime for taxpayers was announced by the government of India. the government of India gives taxpayers the selection to choose between the prevailing tax structure or the new one when filing taxes from FY2020-21 onwards. Under this new tax regime, there is no higher tax exemption limit for senior citizens. Senior Citizens Income Tax Slabs FY 2020-2021 Income tax slabs Rate of tax Health and education cess Up to Rs.3 lakh No tax N/A Rs.3 lakh - Rs.5 lakh 5% 4% of income tax Rs.5 lakh - Rs.10 lakh 20% 4% of income tax Above Rs.10 lakh 30% 4% of income tax Super senior citizens Income tax slabs (more than 80 years older) for FY 2020-2021 Income tax slabs Rate of tax Health and education cess Up to Rs.5 lakh No tax N/A Rs.5 lakh - Rs.10 lakh 20% 4% of income tax Above Rs.10 lakh 30% 4% of income tax