The Department of Income Tax has now provided some relief for senior citizens. So, for those aged 75 years or more, exemption from ITR filing may be warranted. This exemption is applicable only under some specified conditions under Section 194P.
This exemption is applicable for Assessment Year 2025-26. But, to avail of these exemptions, certain conditions have to be satisfied. A valid condition is that he should be a resident of India. The income is to be derived only from pension and interest.
Who Can Claim The ITR Filing Relief for Senior Citizens?
This ITR filing relief for senior citizens is not available to everyone. It is available to those who qualify under three main criteria:
- Age must be 75 or above.
- Income must be only from the pension and interest.
- The interest income must be from the bank that pays the pension.
Also, that bank must, of course, be one of the “specified banks,” as notified by the government.
ITR Filing Relief for Senior Citizens: Is Form Submission Mandatory?
Eligible senior citizens who wish to benefit from the regulation must submit a declaration in Form 12BBA to their bank. This form is a self-declaration of their sources of income and tax deducted at source. Very crucially, this is part of obtaining the relief.
The declaration form must necessarily include the following:
- PAN (Permanent Account Number)
- Pension Payment Order (PPO) number
- Details of the total income
- Details of deductions under sections like 80C, 80D, etc.
- Information about any exemption under section 87A
- Name of the pension-paying employer
- Name of the specified bank
After the declaration is submitted, the bank shall take care of the whole deal. The bank shall compute the total income of the senior citizen in respect of pension and interest thereon, apply the relevant deductions and exemptions provided under the Income Tax Act, calculate the tax payable, and deduct the necessary TDS(Tax Deducted at Source).
No Need for ITR Filing After Declaration
The next step after TDS has been deducted by the bank is that senior citizens do not need to proceed any further with ITR filing. This gesture saves the resources of time and labour and reduces the stress of coping with online systems or taking help from external persons.
This system particularly benefits seniors who are not well-acquainted with the digital procedure. If the bank is taking care of tax application and deduction, the individual will be free from the complexities of return filing.
Also, the tax-related facility concerning ITR filing for senior citizens gives peace of mind to the family. It lightens the financial obligations of the family if there are elderly family members living at home who qualify.
Tax Regime Options Available
The senior citizens may, however, select under either of the two tax regimes.
- A proof of investment must be given if they choose the old regime.
- No proof will be required for the new regime.
It helps the banks calculate tax more accurately.
Why This ITR Filing Relief for Senior Citizen Matters
The preferred income sources for the elderly are generally pensions and interest. It becomes a really heavy burden for them to go through cumbersome tax formalities. A tax exemption under Section 194P has been introduced in the Income Tax Act to lighten their burden. This section, introduced through the Finance Act 2021, aims at lessening the compliance burden for old taxpayers.
With the commencement of the ITR season, exemptions granted under this section continue to be useful. It is worth checking whether families of senior citizens fall into this category. If they do, filing for a return may not be required.
Conclusion
The government has taken a wise step. The ITR filing relief for senior citizens makes their life easy and clear. It is equally important to spread the word of this facility, which can help save a lot of time and effort.
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