New Deduction for Senior Citizens: Section 80TTB Explained
Under Section 80TTB of the Income-tax Act, senior citizens can now benefit from a deduction on the interest income earned from various bank deposits, including fixed deposits.
Who is Eligible?
This deduction is exclusively available to senior citizens, defined as resident individuals aged 60 years or more during the previous year, who derive income such as interest on bank deposits. It is important to note that only senior citizens who are residents of India can claim this deduction.
Eligible Income
Senior citizens can claim a deduction under Section 80TTB for the interest earned on deposits, including fixed deposits, held with banking companies, cooperative societies engaged in banking business, or the post office.
Deduction Limit
The deduction amount under Section 80TTB is capped at the interest credited to the account or Rs 50,000, whichever is lower.
Income Tax Regime
It’s crucial to be aware that this deduction is only available under the old income tax regime and is not applicable under the new income tax regime or the alternative tax regime under section 115BAC.
This new provision aims to provide senior citizens with additional financial relief, reflecting the government’s continuous efforts to support this demographic.