Senior citizens are eagerly awaiting measures aimed at enhancing their financial comfort in today’s fast-paced world. This could involve extended deadlines, adjusted timelines, or specific provisions for income tax deductions, filing procedures, or rebates.
Parizad Sirwalla, Partner and Head of Global Mobility Services at Tax, KPMG in India talking with HT highlights that over 10 percent of India’s population comprises senior citizens aged 60 years and above. With the government focusing on schemes like the Pradhan Mantri Vaya Vandana Yojana and Ayushman Bharat as part of its agenda, changes in tax policies for seniors are anticipated in the upcoming budget.
Here are key changes senior citizens may expect in Budget 2024:
- Increase in Standard Deduction: Considering rising living costs, there’s a call to raise the standard deduction limit from the current Rs 50,000 to Rs 1 lakh, benefiting pension earners.
- Enhanced Deduction Limit under Section 80TTB: Senior citizens could see an increase in the deduction limit under Section 80TTB from Rs 50,000 to Rs 1 lakh, applicable even under the New Tax Regime, reflecting their reliance on secured investments like bank deposits.
- Tax Deduction for House Rent: A potential tax deduction for senior citizens renting homes, particularly those without regular pensions, aims to alleviate financial burdens on elderly renters.
- Higher Health Insurance Premium Deductions: Speculations suggest an increase in health insurance premium deductions from the current Rs 50,000 to at least Rs 1 lakh, aiming to mitigate rising healthcare costs for seniors.
- LTCG Tax Exemption Limit Increase: There’s anticipation for raising the Long-Term Capital Gains (LTCG) tax exemption limit for seniors from Rs 1 lakh to Rs 2 lakh, enhancing financial flexibility and tax relief on investments.
Additionally, seniors seek raised tax exemption thresholds for both old and new tax systems, alongside exemptions on pensions from NPS, EPS, and other sources. They also hope to rationalize Section 194P to extend the age exemption for filing income tax returns beyond 75 years.
These expectations reflect seniors’ aspirations for improved financial stability and support in navigating economic challenges, ensuring they maintain adequate disposable income amid inflationary pressures.