Tax
Planning for Senior Citizens A.Y. 2016-17 and
A.Y. 2015-16: The
category of senior citizens has been under the purview of income tax from a very long time. However, there has been certain
relief that has been provided to them when it comes to imposing taxes on their
income. A person is regarded as a senior citizen if the person is above the age
of 60 years. Some of the tax
planning tips for senior citizens is as follows:
Maximum Age Limit of
Senior Citizens & Very Senior Citizens?
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The age limit for a
senior citizen is 60 years or more for A.Y. 2016-17 &
2015-16. The age limit for very senior citizens is 80 years or more for A.Y. 2016-17 &
2015.16.
Basic Exemption Limit
When it comes to
determining the basic limit for computing tax liability, the senior citizen
section enjoys a freedom upto Rs. 3,00, 000
per year (A.Y.2016-17) and same for A.Y. 2015-16. Any
income which is within the prescribed limit shall necessarily be exempted from
the purview of taxation. A very
senior citizens can claim up to Rs. 5,00,000.
Senior citizens (60
years or above) not having any income from business or profession shall not be
liable to pay advance tax.
Permissible Deductions
·
Investments: Deduction in respect
of life insurance premium,
provident funds, repayment of housing loan etc. up to a maximum of
Rs.1,50,000/-[Sec. 80C].
·
Additional deduction of Rs. 50,000 (maximum) for contribution to
notified Pension Scheme.
·
Investment in health
policies: Just like the benefits which accrue to the ordinary residents,
even senior citizens are entitled to receive a deduction of Rs. 30, 000 (only for senior citizens)
(A.Y.2016-17)/ Rs.20,000 (A.Y.2015-16). When they invest
in medical policies under the section 80D. Check complete detail about
deduction under section 80D (mediclaim)
·
One more deduction related to mediclaim added from
A.Y.2016-17 i.e. expenditure on medical treatment of resident very senior citizen (80
years or above) not having medical insurance cover, shall also be deductible
within the aforesaid limit of Rs.30,000. [w.e.f. 1.4.2016 A.Y.2016-17]
