Tax Planning for Senior Citizens F.Y.2022-23 A.Y.2023-24

Tax Planning for  Senior Citizens F.Y.2022-23 A.Y.2023-24: The category of senior citizens has been under the purview of income tax for a very long time. However, there have 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:

Who is Senior Citizen

A Senior Citizen is an individual who has reached the age of 60 during the previous year.

For Example: In other words, you can say that if you have completed the age of 60 years and you will be treated as Senior Citizen as per the Income Tax Act.

Who is Very Senior Citizen

A Very Senior Citizen is an individual who has reached the age of 80 years during the previous year.

Tax Rebate

A tax rebate can be claimed by senior citizens whose income is up to Rs. 5 lakh. This rebate is equal to the amount of tax or Rs. 12,500/- whichever is less.

Advance tax Exemption

In the event that a senior citizen does not have any income from a business or profession, they shall not be entitled to pay any advance taxes. There is no need for them to pay any kind of advance tax. Therefore, they are not liable for penal interest if they do not pay advance tax. Please read more detail about Advance Tax Payment here.

Pensioners Senior Citizen Exempt to File Income Tax Return

Senior citizens who are 75 years of age or older do not need to file income tax returns if they meet the following criteria.

  • The only source of income is pensions and pension interest
  • Those who make a bank declaration in form 12BBA to that effect
  • Under section 194P, the bank has deducted TDS from their income

Basic Exemption Limit

The IT Department of India has increased the exemption limit for senior citizens. Now people who fall under this category can claim a basic exemption of INR 3, 00, 000 on their total income for a particular AY. In case, the age of a taxpayer has reached 80 years, the same exemption limit increases to INR 5, 00, 000.

It is therefore advisable to invest in schemes where the income generated is taxable in a manner that does not exceed the basic exemption limit (Rs. 3 lakh in the case of senior citizens 60 years of age or older, but not exceeding 80 years of age, and Rs. 5 lakh in the case of very senior citizens 80 years of age or older).

Check Income Tax Slab Here

Senior citizens (60 years or above) not having any income from business or profession shall not be liable to pay advance tax.

For more information go to: Computation of taxable Income and tax payable for individuals

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 ordinary residents, even senior citizens are entitled to receive a deduction of Rs. 50, 000 (only for senior citizens). When they invest in medical policies under the section 80D. Check complete detail about deduction under section 80D (mediclaim)

Check all income tax deductions from Gross Total Income

On an Income of Rs.8,00,000 senior citizens is not liable to pay tax planning.

Yes, it is true, if you are a senior citizen then you don’t need to pay tax on income up to Rs.8,00,000 for A.Y.2023-24. But it is possible only by proper tax planning.

Income/Deductions Amount
Gross Total Income 8,00,000
Less: Deduction under section 80C, 80CCC and 80CCD(1) 1,50,000
Less: Deduction under section 80CCD(1B)  50,000
Less: Deduction under section 80D  50,000
Less: Deduction under section 80TTB 50,000
Taxable Income 5,00,000
Tax Payable 10,000
Less: Rebate under section 87A 10,000
Net Tax Payable Nil

There are also numerous other options for “Tax Planning for  Senior Citizens” that can be conceived and cleverly implemented such that the seniors can avail the maximum tax benefit and end up with as lesser tax liability as possible. But it should be remembered that no unfair means should be used while framing a valid tax planning session else the same case then might turn into a case of tax evasion. Make your decisions wise and thoughts wiser because after all whatever you pay to the Government in form of taxes are ultimately spend on your benefits and comfort.

60 thoughts on “Tax Planning for Senior Citizens F.Y.2022-23 A.Y.2023-24”

  1. I am a pensioner. I am getting a honorarium of Rs 40 thousand per month.I am saving about Rs one lakh per year and putting that amount in a bank as FD. I am filing IT returns . Some % amount is deducted as TDS from my income.Again Should i pay tax on FD interest also.It may be noted that the savings are from the amount for which I have already paid tax.

  2. I am a senior citizen.
    I have sold my property and have earned long term capital gain on the sale.
    After buying LTCG bonds, I am to pay tax on the remaining amount. Since Senior citizens are exempt from paying advance tax, can I pay this entire tax as Self assessment tax at the time of filing my return.

  3. I am a senior citizen age 68 and I don’t have any source of income for my expenses except pf of 600 rupees per month and I am selling my house for 45 lakhs as I need money for my expenses what are my options to save tax and use half the money to pay rent and for my expenses?

  4. I am a senior citizen reaching the age of 80 years on Feb 18th 2017 I don’t have a house of my own paying a rental accommodation of ₹2000 pm my net take home pension 700800/ per annum I don’t have any savings how much is my tax liability

  5. sir what is actually tax rebate to senior citizen above the age of 60 years
    for the 2016-17 pls. reply.

  6. My mother is 70 yrs old. she receives a widow pension of 19000/- per month. My Dad passed away in 2011 and the FDs are now transferred to my mother. it is around 15 lacs. she invested around 10 lacs in MF . Is she liable to pay Income TAX and does she have ti file return?

  7. Once again repeating my query:-
    for FY1516 if I give an ACK of Lease Rent Recd. @ say Rs.10,000/- pm to my Son for declaring to his Office then will it be exempt from his Income re.HRA an will it be taxable in my Sr.Citizen Income?

    • Hello TV Subramanian, Sorry for late reply. Yes you are right, Your son can claim as business expenses if he declare his income as business and profession. And it is treated is as your rental income. plz ask if you have any doubt. thanks

  8. In order to help my son claim HRA (HOUSE RENT ALLOWANCE) EXEMPTION from being computed as his taxable income,I suggested he give declaration to his employers that I am receiving say Rs.10,000/- pm from him for FY1516/AY1617 which Lease Rent I will show in my IT-RETURN as my Income of Sr.Citizen as I have ample scope in my Limit of Rs.3,00,000/-. What precautions shd I take for this purpose?

    • Hello TV Subramanian, Sorry for late reply. Yes you are right, Your son can claim as business expenses if he declare his income as business and profession. And it is treated is as your rental income. plz ask if you have any doubt. thanks

  9. Senior citizenship rebate for f.y.2015-16 (a.y.2016*17) will be applicable even if I complete my age of 60 yrs. on 12th September 2015.

  10. I am a senior citizen having age 78 and my pension + interest on fixed deposit will be around 600000(6 lac).
    Kindly tell me know the tax to be paid considering deduction under section 80 C if applicable. for AY 2014-15.
    what would be the deduction amount and under which section

    regards & Thanks

  11. I am a senior citizen :
    Pension income : Rs1.88,000 , FD interest + bank interest comes to Rs 3.20,000/-.
    do i get any benefit under section 80 C as PPF invested 1.00 L , SCSS scheme

    Please guide

  12. I am a working senior citizen. I come under the highest income tax bracket. since investment in NPS for the purpose of tax saving is available only upto the age of 60years , how do I avail of the additional Rs 50000 deduction apart from Rs 150000 in PPF?

  13. i am a senior citizen having age 63 and my pension + interest on fixed deposit will be around 600000(6 lac).
    I know I can save tax upto 5 lac (3 lac exemption and 2 lac investment).So i have to pay tax on 1 lac i.e 10000.Kindly tell me last date to pay this tax for AY 2015-2016.

  14. I am a senior citizen I want to make payment tax for 2014-2015 which will ending 31st march 2015. through
    net banking. pl guide which form use A.Y 2015-2016 CORRECT OR NOT .ADVANCE PAYMENT OR NOT

  15. my father in law just retired. he will get 23000/month pension and got 20 lakhs. if he make fd of 20lakhs he will get 180000 as interest so he will accumulate 456000. what will be the income tax figure. he dont have hbl. only sbi life of 20000/ann

  16. My father in law expired in Dec 2013 he was of the age of 92 , his wife was not an earning member and as such she is 82 years , now after his death all the investments have been transfered on her name and she earns interest on the same . She would need to start filing her returns so what is the benifits she can claim.

  17. i m a 71 year sr citizen lady having income from various sources like rent income and income from bank interest and so plan to give loan.

  18. hi, my age is 80 years and few months. my tenant wants to submit HRA claim at his office and asked for my PAN number. i hope as i’m above 80 (super senior citizen), i don’t have to share my PAN number. Rent is Rs.17,000 per month. In such case, a declaration can be given by me to my tenant. hope i’m correct. please let me know and the correct declaration form. Thank you.

  19. Hello, thanks nice article. I pay fee
    to my accountant to manage my tax affairs. Is this deductible? Also are any
    repairs to self-occupied house property claimable?

  20. I m a aged 65 . is there an exemption for me not to pay service tax on the services provided by me

  21. i am 80 yrs old.I have sold my house and staying with my son.i want to gift the sale proceeds to my son as i want to help him in purchase of house.whether i am liable to any capital gain tax

  22. Total interest income from Babnks and MIS (Poast Office)
    is Rs.4,40,000/- per year. I am retired from Service on supernnuation (60 years) what would be my tax liability for
    the AY 2013-14. I am getting full medical reimbursement from
    my employer i.e. BHEl. and hence I have no mediclaim.
    I do not have reental income too. Only interest income as
    shown above. Do I need to file I.T.return at all.

  23. I am a senior citizen and house wife. Most of my income is from Fixed Deposits. My total income before allowing deductions wont cross 2,50,000(excluding dividend income and long term capital gains on shares). There is never a short term capital gain. Do I need to file returns?

    • Yes, any person with income other than salary income + Savings bank interest is liable to file income tax return, even though there is no tax liability. Any one with FD interest income or long term capital gain have to file income tax return even though there is no tax liability because the interest income is less than 2,50,000 for a senior citizen. Best to consult a chartered accountant.

  24. I think now for availing deduction of Rs 100000/- one can invest the entire amount in PPF under sec80C as against Rs 70000/- earlier. Is this true?

  25. Is the interesdt earned from post office monthly income scheme upto 12,000 rupees exempt from income tax as mentioned in your article ? Please confirm whether this is a fact.

  26. The 5.2 Lakhs threshold sounds like a joke.Can’t imagine a Senior Citizen stil refunding his Housing Loan!! 80D limit 15000 or 20000? Writeup says 15000, example says 20000.

  27. The short term capital gains will be tax free if the basic threshold limit of 15% is not crossed.This is not well understood.

  28. My Grandfather is State Government Employee and he will be retired on 31st March’13 on account of completion of 60 years on 10th march’13

    My Question is: Senior Citizenship rebate will be allowed or not for the FY 2012-13 ?

    Pls Help

    • Rebate will be allowed for FY 2013-14 only. I am also a retired person, retired several years back and had to clarify this point about the eligibility from which year.

    • sr. citizenship rebate will be applicable even if he completes his age of 60 yrs. on 31st march 2013 .

    • SURE – Your Grand Father is Valid to Get Rebate of Senior Citizen for F.Y 2012-13. He completed his 60 in this financial year so Valid.

    • What the query, seen to have so far remained unanswered, refers to is the payment by way of self-assessment. But, what is not to be oversighted is the other requirement of ‘advance tax’ should that apply to a given case.

  29. Sr.citizen having no buisness income may pay his income tax in the month of july 3013 before submitting income tax return? pls. clarify.

      • I am a senior citizen 66 years. I have income from pension Rs 5.9 lac, interest from s/b account 35,249/-, interest from FD 3,92,233, prof. income 10,000/- house rent income 84,000/-and POIMS interest 16,080/- . I intent to save 1.5 lakh to avail 80C.

        My question is whether as a senior citizen have I any deduction from my FD interest over and above the exception of 1.5 lac under 80 c and 10,000/- exception from savings bank interest in Assessment year 2015-16 ?


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