While presenting the budget, the Finance Minister said that the senior citizens who only have pension and interest income are exempted from filing the tax returns.
“I begin my direct tax proposals by offering my pranaam to our senior citizens. Many of them, despite having foregone several basic necessities of their own, have strived to build our nation.”
“Now in the 75th year of Independence of our country, when we continue our endeavour with renewed vigour, we shall reduce compliance burden on our senior citizens who are 75 years of age and above. For senior citizens who only have pension and interest income, I propose exemption from filing their income tax returns. The paying bank will deduct the necessary tax on their income,” she said.
Further, the budget also proposed to amend the provision relating to tax deduction under section 194P of the Income Tax Act, 1961 wherein the Bank is liable to compute the total income of such specified senior citizen for the relevant assessment year and deduct income-tax on such total income on the basis of the rates in force to give effect to the deduction allowable under Chapter VI-A and rebate allowable under section 87A of the Act. In 2019, the provision was amended as per which, a rebate under section 87A is one of the income tax provisions that help taxpayers reduce their income tax liability. Taxpayers earning an income below a certain limit have the benefit of paying marginally lower taxes.Subscribe Taxscan Premium to view the Judgment