Section 80C of the Income-tax Act, 1961 allows for a deduction for contributions to SCSS. This tax benefit, however, is limited to the present annual limit of Rs 1.5 lakh for all investments made under section 80C. The interest received under the scheme is taxable in the hands of the depositors.
Tax Saving for Senior Citizen – According to Section 80C of the Income Tax Act, 1961, senior citizens can save TDS on these schemes. Select Your Investment- There is only one investment permissible for every Senior Citizen Saving Scheme account.
Yes, you can claim deduction under Section 80TTB on both interest form savings and deposit accounts with banks, but the deduction amount is limited to Rs 50,000.
SCSS, short for Senior Citizen Savings Scheme is a government-sponsored savings instrument for individuals above the age of 60. The Government of India introduced this scheme in 2004 intending to provide senior citizens with a steady and secure source of income for their post-retirement phase.
One can invest a maximum of Rs 15 lakh in Senior Citizens' Savings Scheme (SCSS) in their individual capacity. But one can hold a joint account with one's spouse, where the spouse has to be a first holder, and deposit another Rs 15 lakh. So, effectively, one can deposit a maximum amount of Rs 30 lakh.
Q- Can a senior citizen invest Rs. 150000 in the Senior Citizen Savings Scheme (SCSS) every year to get 80C deduction under the Income Tax Act of India? An amount deposited under the Senior Citizens Savings Scheme Rules, 2004 is eligible for deduction of Rs. 1.50 lakhs under section 80C of the Income Tax Act, 1961.
Section 80C of the Income-tax Act, 1961 allows for a deduction for contributions to SCSS. This tax benefit, however, is limited to the present annual limit of Rs 1.5 lakh for all investments made under section 80C. The interest received under the scheme is taxable in the hands of the depositors.
Other than the element of safety, SCSS pay higher interest than a fixed deposit of the same tenure (5 years). While an SCSS can fetch you 8.3 percent (July-Sept 2018) per annum on your deposit, an FD for senior citizens will give you 7.25 percent presently.
The amount deposited in the SCSS account earns interest for a term of five years. An account holder can apply for a one-time extension of three years within one year of the maturity of the account. The deposit in an extended SCSS account will earn interest at the rate applicable on the date of maturity.
In the Union Budget 2018, Finance Minister Arun Jaitley announced tax exemption in interest income up to Rs. 50,000 for senior citizens. It means senior citizens will not have to pay any taxes on FD interest earned up to Rs. 50,000.
2019. The interest rate on SCSS is taxable and the investment amount can be utilised as a deduction under Section 80C of the Income Tax Act, 1961. The SCSS interest will be subject to TDS if the interest income exceeds Rs. 40,000 in a single financial year.
Also, u/s 194A of the Income Tax Act, no Tax is Deducted at Source (TDS) on interest payment of up to ₹ 50,000 by the bank, post office or co-operative bank to a Senior Citizen. This limit is to be computed for every bank individually.
Also, individuals can make a deposit only once, at the time of opening an account. Eligible individuals can start more than one account under this scheme. However, the deposit limit of all those accounts combined is also capped at Rs. 15 lakh.
You can extend the Senior Citizen Savings Scheme (SCSS) Account up to 8 years. On maturity after 8 years, can I open another account? The tenure of Senior Citizen Savings Scheme (SCSS) Account is five years.
A Senior Citizen Savings Scheme (SCSS) account has a tenure of five years and the deposited amount is paid back to the investor on maturity. While the depositor can open a new SCSS account after the maturity, however, the depositor has the option to extend the maturity by three years.
For the quarter July 2022 to September 2022, there will be no change in the post office small savings interest rates. As per the PTI tweet, “the government keeps interest rates on small savings schemes unchanged for July-Sept quarter.”
Standard deduction amount increased.
The amounts are: Single or Married filing separately—$12,550. Married filing jointly or Qualifying widow(er)—$25,100. Head of household—$18,800.
The way to avoid paying too much tax on your pension income is to aim to take only the amount you need in each tax year. Put simply, the lower you can keep your income, the less tax you will pay. Of course, you should take as much income as you need to live comfortably.
Standard deduction to pensioners & salaried persons
2.5 Lakhs for AY 2019-20 and is continued for AY 2021-22 also. For Senior citizens, the basic exemption limit is set @ Rs. 3 Lakhs.
This year onwards, senior citizens aged 75 years and above looking to get exemption from filing income tax should fill and submit form 12BBA with their respective banks. Senior citizens with income only from pension and interest from fixed deposits are eligible for this exemption.
A tax-saving fixed deposit (FD) account is a type of fixed deposit account that offers a tax deduction under Section 80C of the Income Tax Act, 1961. Any investor can claim a deduction of a maximum of Rs. 1.5 lakh per annum by investing in a tax-saving fixed deposit account.