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Finance
Published: July 20, 2023
Updated: July 20, 2023
As the deadline for income tax return (ITR) filing for FY 2022-23 approaches, senior citizens aged 75 and above may find some respite. The Income Tax Act's Section 194P, introduced in Budget 2021, offers relief to select senior citizens from filing income tax returns, provided they meet specific eligibility criteria. Let's explore the conditions that make ITR filing optional for these individuals and the benefits they can avail of.
Section 194P of the Income Tax Act, in effect from 1st April 2021, brings good news for senior citizens aged 75 years and above. It exempts them from the mandatory ITR filing if they meet certain qualifying criteria. By having income solely from pensions and interest through specified banks and submitting a declaration to the bank, senior citizens can enjoy this benefit. The specified bank will then handle tax deductions, negating the need for ITR filing.
To be eligible for ITR exemption, senior citizens must fulfil the following conditions:
● Be a resident of India and attain the age of 75 years or more by the end of FY 2022-
23.
● Have income solely from pensions or interest through specified banks, with interest
income accrued/earned from the same bank where they receive their pension.
● Submit a declaration to the specified bank acknowledging their eligibility for the
exemption.
While senior citizens with total income below the taxable limit are not obligated to file ITR, if any TDS has been deducted from their earnings, they may need to file for a refund. In cases where a senior citizen has deposited funds in the same bank from which they receive their pension, the bank can accurately deduct TDS based on applicable chapters (e.g., 80C) and handle tax deposits on their behalf. Consequently, ITR filing will not be required for such individuals.
The government has not considered an extension of the July 31 ITR filing deadline. The
finance ministry urges income taxpayers to submit their returns promptly. Revenue Secretary
Sanjay Malhotra expressed optimism about higher filing rates this year compared to the
previous year.
Senior citizens aged 75 years and above stand to benefit from the simplified ITR filing
process under Section 194P of the Income Tax Act. With pensions and interest income from
specified banks, they can submit a declaration to their bank and be exempted from ITR filing.
This welcome relief streamlines the taxation process for these individuals, making it easier
for them to comply with tax regulations. As the deadline nears, senior citizens eligible for the
exemption should take advantage of this provision to simplify their tax filing journey.
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