Section 80TTA is not applicable to senior citizens. They enjoy a higher tax benefit under a different section. Interest earned on saving deposits and fixed deposit with banks or post office or co-operative banks for an amount up to ₹50,000 earned by the senior citizen is eligible for deduction under Section 80TTB.
Section 80TTA provides a deduction of Rs 10,000 on interest earned on the Savings account. However, only individuals and HUFs can claim deduction under this section.
Section 80TTA of the Income Tax Act 1961 provides deduction on the interest earned on your savings account with a bank, cooperative society or post office, up to Rs. ... No deduction for FD interest is available u/s 80TTA.
Deduction under section 80TTA will be allowed only if you have shown income of Rs. 3500 as interest from saving bank a/c otherwise it will be disallowed. if you have shown income of Rs. 3500 as interest on saving bank a/c and still it is disallowed then you can file rectification in e filling portal of Income Tax.
To claim the deduction under this section, first, add your total interest income under the head 'income from other sources' in your Income Tax Return Form. The deduction will be shown under Section 80 Deductions under Section 80TTA of Income Tax Act.
Section 80TTA of the Income Tax Act allows you to claim deductions on savings accounts deposits that are held in a post office, bank, or cooperative society. Exemption sought should be less than Rs. 10,000.
Section 80TTB of the Income Tax Act allows tax benefits on interest earned from deposits with banks, post office or co-operative banks. The deduction is allowed for a maximum interest income of up to ₹ 50,000 earned by the Senior Citizen.
For senior citizens above the age of 60 years, interest is taxable if the total interest paid in all SCSS accounts in a financial year exceeds Rs. 50,000 (for those below 60 years it is Rs 40,000), and TDS at the nominal rate is deducted from the total interest paid.
As per the Income Tax rule, losses from business income (non-speculative) gets set off against IFOS income. And deduction under chapter VI-A is applicable on remaining incomes if any available.
Deduction on Interest Income Under Section 80TTA
For a residential individual (age of 60 years or less) or HUF, interest earned upto Rs 10,000 in a financial year is exempt from tax.
Section 80TTA allows deduction in respect of interest income on deposits in Savings Bank Accounts of Banks, Co-Operatives Banks or Post Office. The quantum of deduction allowed under this section is Rs. 10,000 or the actual interest earned, whichever is lower.
The tax deduction under Section 80TTA is over and above the deduction of ₹ 1.5 lakhs, which is deducted under Section 80C. No Tax Deduction at Source (TDS) for savings accounts held by individuals and HUFs. ... In such cases, the individual does not need to file any tax return.
However, senior citizens can claim deduction under section 80TTB for the maximum up to Rs 50,000 in a single financial year. There is a tax deducted at source (TDS) on the interest payment if the amount is more than Rs 10,000 per annum as per current tax laws.
Post Office Savings Scheme 2021: If an individual is planning to make an investment must be aware of the 15-year Public Provident Fund Account (PPF) at India Post. One can get a good return on this scheme as it offers 7.1 per cent interest per annum (compounded yearly).
In 2021, the threshold was $18,960 a year. That threshold will rise to $19,560 a year in 2022. During the year you reach full retirement age, the SSA will withhold $1 for every $3 you earn above the limit. That limit was $50,520 a year in 2021 and will increase to $51,960 a year in 2022.
From AY 2020-21, a standard deduction upto Rs. 50,000 against salary income can be claimed by an individual u/s 16 of IT Act, 1961. Accordingly, senior citizen who is in receipt of pension income from his former employee can claim a deduction up to Rs. 50,000/- against such salary income.
"As Section - 80TTA and 80TTB are covered under chapter-VIA and the new tax regime excludes deductions under chapter-VIA subject to certain exceptions. ... This loss could be set off against salary income thereby reducing the individuals' taxable income and net tax liability.
This tax deduction from total income is accessible to all Hindu undivided family and all individuals taxpayers. The documents they need to have are saving account bank statements is sufficient and enough to calculate your interest in income and tax deduction on incomes.
Tax-saving FD allows you to make an investment to save tax under section 80C of the Income Tax Act. The minimum tenure for a term deposit under Tax Saving Scheme is 5 years. You can get a tax exemption of a maximum of Rs. 1.5 lakh.