AY 2020-21 (FY 2019-20) (i) Article 88TTA refers to individuals (with the exception of sr citizens), while Article 88TTB refers to sr citizens. Interest income from the bank`s savings accounts and FDs up to a maximum of Rs.50,000/- is the deduction available to a citizen sr under Article 80TTB. (ii) Investments under the Senior Savings Plan may be deducted from a senior citizen up to Rs.1.5 Lakhs under Article 80C. (iii) With the extension of the last deadline for the submission of the computer return for AY 2020-21 by resident Indians/seniors until November 30, 2020, can his self-assessment tax for AY 2020-21 be filed through Bank chalan before November 30, 2020 before the submission of the computer return? In previous years, he transferred the self-assessment tax in June/July before filing his tax return. Pl. clarify. § 80TTB has been amended by 1. April 2018, which entitles seniors to receive benefits for the 2018-2019 fiscal year. This article acts as an assessment of Article 80TTA since the tax deduction threshold on interest income has been increased from INR 10,000 to INR 50,000. The interest is distributed to the appraiser and then that income is taxable. The amount deducted must be the amount indicated by the total gross income and must be up to Rs 50,000.
Among the income indicated, all the following sources of income are counted in their aggregate – Maxm deductions for 80c and 80ttb for residents sr citizens will be 200000 / – when applying for tax return. Introduction: The 2018 financial budget introduced Article 80TTB, which provides tax relief on interest income for india`s elderly people. Under the Income Tax Act, a senior is a person who, at any time during the relevant fiscal year, is a resident person who is 60 years of age or older. According to this newly introduced section, any elderly person as a resident of India can claim a deduction of up to Rs 50,000 on interest income from deposits in the relevant financial year. However, there are some limitations and exceptions to this section. The following article provides detailed information about Section 80TTB and helps you navigate the terms and conditions. For example, Mr. Arun, who is 65, is a partner in a partnership company, XYZ & Co. It receives interest on a fixed deposit of Rs 30,000 from XYZ & Co.
during the financial year. Interest is received as its share of the company`s revenues. The fixed deposit is held by the partnership on behalf of XYZ & Co. Here, interest income is fully taxable. In computing Mr. Arun`s total income, no deduction under Section 80TTB will be possible. Article 80tta provides for deductions similar to those provided for in Article 80TTB. However, it only offers interest deductions on a savings account held in a bank, cooperative bank or post office, from the total gross income of the individual taxpayer or Hindu undivided family (HUF) up to Rs 10,000. With the introduction of § 80TTB exclusively for the elderly, no deduction according to § 80TTA is available for the elderly.
An elderly citizen cannot claim deductions of RS.10000 under section 80tta with Rs.50000 below section 80ttb? Section 80TTB of the Income Tax Act 1961 allows a resident elderly person to claim an interest deduction on the deposit. Section 80TTB is popular for claiming the deduction of interest income on a term deposit and the balance of a savings account. It was introduced to provide benefits to older taxpayers in the form of a relaxation of interest income. In this article, we have covered all aspects related to the deduction of Section 80TTB. Since the introduction of § 80TTB, tax savings for the elderly have been much easier than before. In fact, compared to the normal taxpayer, the senior is able to make more savings thanks to his interest income on various fixed deposits and savings. This section is specifically for people aged 60 and over. Section 80TTB provides that the taxpayer is exempt from paying income tax to a certain extent by discounting some of the following deductions, assuming that the deposits reported are held by or in the name of a partnership. In this case, an association of persons (AOP) or a partnership of individuals (BOI), deduction of article 80TTB is not available to the partner of this company or a member of this AOP or BOI in the calculation of their total income. It is recommended to use the tax relief for maximum benefit. The senior must use the tax relief to invest in such deposits with companies that are specified so that the total interest income from deposits amounts to Rs 50,000 per financial year.
This becomes a great savings strategy through investment, as seniors` interest income becomes tax-free. Indeed, interest is deductible from their income before taxes are collected. Simply put, if eligible interest income is less than INR 50,000, all interest income would be allowed as a deduction. However, if the interest income exceeds INR 50,000, only INR 50,000 would be allowed as a deduction under Section 80TTB. Eligible corporations can claim deductions under section 80TTB of the Income Tax Act, 1961 by simply filing their income tax return. Before doing so, however, they must include interest income from various deposit accounts in their total income in a fiscal year. It should be noted that interest income on savings accounts and fixed or recurring deposits held with the three companies mentioned above will be taken into account for the purposes of the deduction. In addition, there is also interest earned on other types of offices.
These include securities such as senior savings accounts, postal deposits, five-year recurring deposits, and post office monthly income systems. It can therefore be concluded that Article 80 BWC expressly mentions only those sources of interest income which are fully deductible. However, interest received from other programs and sources, such as interest from an FD corporation, is not eligible for such deduction. In addition, interest income from bonds and debentures will be excluded from the deduction under this Section. Section 80TTB is a provision under which a taxpayer who is a resident aged 60 and over may claim a certain amount at any time during a fiscal year (FY) as a deduction from his or her total gross income for that fiscal year. This section comes into effect on April 1, 2018. Note: Yes, Section 80TTB includes FD interest. This means that interest income from a senior`s fixed-term deposits is allowed as a deduction in accordance with § 80ttb. Seniors should inform themselves about all aspects of section 80TB of the Income Tax Act in order to slightly reduce their tax liability. Above all, a fair idea of the deduction and claim process that comes with it will allow individuals to protect their interest income from expiry and, as a result, accelerate the increase in savings.
As a result, seniors will be able to manage their income more effectively, allowing them to achieve financial stability. Can we claim 80 ttb on deposit interest if tds that have already been deducted from Article 80TTB (2) expressly states that interest income from the savings account held by the Company or association of persons (AOP) or the Individual Company (BOI) is not allowed as a deduction under Article 80TTB for partners of the Company or members of the association or individuals of the BOI. I came across an article stating that elderly people who only have interest income from bank deposits can claim the deduction and if they have salary income or a pension, § 80ttb is not applicable. Can someone clarify ANS: FD interest earned by seniors is taxable, however, section 80ttb provides for a deduction of the same maximum up to a maximum of UP to INR 50,000. Both Article 80TTA and Article 80TTB provide for a deduction of interest income. The table below would help the reader understand the fundamental difference between Article 80TTA and Article 80TTB – A large number of older people in India invest their savings in fixed deposits in banks or post offices to generate fixed income. This interest income helps them to be alone in their retirement phase and to meet their daily needs. However, interest income from bank or postal deposits is taxable under the Income Tax Act of 1961.
To relieve these seniors and reduce their tax burden, Section 80TTB was introduced by the 2018 Finance Bill to allow the deduction of interest income on seniors` deposits. It is also known that Article 80TTA is already there to allow all taxpayers to deduct up to Rs 10,000 of interest income from savings bank deposits. Article 80TTB offers accelerated benefits to elderly taxpayers compared to Article 80TTA. In this article, we will discuss the intricacies of Article 80TTB and answer any questions taxpayers may have regarding this article. A: Section 80TTB of the Income Tax Act provides a deduction for seniors in respect of interest income from deposits made with a bank, co-operative or post office. The maximum deductible amount available is INR 50,000. A deduction of less than Rs 50,000 or some income is allowed on the total gross income. .