LOOKING FOR INCOME TAX-SAVING SCHEMES FOR SENIOR CITIZENS? CHECK THESE 3 OPTIONS

Tax-saving schemes for senior citizens in India: As individuals reach their golden years, financial stability and tax-efficient investment strategies become paramount. Senior citizens in India, defined as those aged 60 or older, and super senior citizens, who are 80 years or above, have unique investment opportunities and tax-saving avenues to consider. Parizad Sirwalla, Partner Tax and National Leader of Global Mobility Services at KPMG, spoke to ET NOW about some of the most attractive investment instruments available for senior citizens.

Senior Citizen Savings Scheme (SCSS)

One of the standout options for this demographic is the Senior Citizen Savings Scheme (SCSS). This scheme allows senior citizens to invest up to Rs 30 lakh, making it an appealing choice for those looking for regular income. It qualifies for a deduction under section 80C of the Income Tax Act. The interest earned on the SCSS is approximately eight per cent annually, though it is taxable.

Tax deductions on fixed deposit interest income

For senior citizens with a preference for lower-risk investments, fixed deposits with banks are a popular choice. Fixed deposits with a tenure of five years or more also fall under section 80C, enabling a deduction of up to Rs 1.5 lakh annually. Additionally, senior citizens can benefit from a tax deduction threshold of 50,000 rupees per annum on interest income from these fixed deposits and other savings bank interests.

Tax deductions for medical expenditure

Beyond investments, health and medical expenses are vital considerations for senior citizens. Under section 80D of the Income Tax Act, senior citizens can claim deductions for medical expenses or health insurance premiums, with a yearly threshold of 50,000 rupees. Furthermore, section 80DDB provides relief for individuals dealing with specified medical conditions, granting deductions of up to Rs 1 lakh.

With careful planning and informed investment decisions, senior citizens can enjoy financial stability and minimise their tax burdens in their retirement years.

2023-10-16T09:42:41Z dg43tfdfdgfd