Benefits for Senior Citizens and Very Senior Citizens under Income Tax Act, 1961

Summary: The supplied material outlines tax benefits for resident Senior Citizens aged 60 years or above but below 80 years and Super Senior Citizens aged 80 years or above under the Income-tax Act, 1961. For AY 2026-27, it states higher basic exemption limits under the old and new tax regimes and refers to Section 115BAC(6) for opting for the old regime. It covers exemption from advance tax where a resident senior citizen has no income under “Profits and Gains of Business or Profession”, standard deduction on pension, and deductions under Sections 80D, 80DD, 80DDB and 80TTB. The material also addresses manual filing of ITR-1 or ITR-4 by eligible super senior citizens, Form 15H for non-deduction of TDS, tax treatment of residential property transferred under the Reverse Mortgage Scheme, and exemption from filing ITR for specified resident senior citizens aged 75 years or more. The material provides the applicable old-regime tax slabs for senior and super senior citizens and the common new-regime slabs for AY 2026-27, along with the stated surcharge, Health & Education Cess and Section 87-A rebate provisions. Relevant TaxGuru material discusses tax benefits available to senior citizens, Section 80D and Section 80TTB.

Income Tax Department
Central Board of Direct Taxes

Benefits For Senior Citizens And Super Senior Citizens Under Income Tax Act, 1961

BENEFITS UNDER DIRECT TAXES FOR SENIOR CITIZENS AND SUPER SENIOR CITIZENS

Who is a Senior Citizen and a Super Senior Citizen?

At any time during the relevant financial year:

• Individual resident who is of the age of 60 years or above but less than 80 years is a Senior Citizen
• Individual resident who is of the age of 80 years or above is a Super Senior Citizen.

Note: Senior Citizen as well as Super Senior Citizen enjoys all the tax benefits available to non-senior citizens along with some special benefits.

Higher Basic Exemption for Senior and Super Senior Citizens

• For Senior Citizens in AY 2026-27, the basic exemption limit is fixed at Rs. 3 lakh in Old tax regime and Rs. 4 lakh in new tax regime.
• For Super Senior Citizens in AY 2026-27, the basic exemption limit is fixed at Rs. 4 lakh in new tax regime (default), while it is Rs 5 lakh in Old Tax Regime.
• Normal provisions of the Income Tax Act are applicable for non-resident senior citizens
• To avail Old Tax Regime, both Senior citizen/ Super senior citizen have to exercise option u/s 115 BAC(6). Otherwise, the New tax regime will be the default.

Note: For other individual taxpayers, the basic exemption limit upto which she/he is not required to pay any tax is Rs. 4 Lakhs (for AY 2026-27 in the New Tax Regime) and Rs 2.5 lakh (For A. Y. 2026-27 in Old tax regime)

Exemption from payment of Advance Tax

• A resident Senior/Super Senior citizen, resident in India, need not pay any advance tax, provided he does not have any income under the head “Profits and Gains of Business or Profession”.

Note: Every person whose estimated tax liability for the year is Rs. 10,000/- or more, is liable to pay advance tax.

Benefits of Standard Deduction

• Senior citizen and Super Senior Citizen who are in receipt of pension income from his former employer can claim a deduction
• up to Rs. 75,000/- against such income under the new tax Regime (AY 2025-26 onwards).
• up to Rs. 50,000/- against such income under old tax Regime

Note: If pension is less than Rs. 75,000 (New tax regime) / 50,000/- (old tax regime) the deduction will be limited to the amount of pension received.

Higher Deduction for Medical Insurance Premium/Medical Expenditure-Section 80D

• This is available only under the Old tax regime
• From AY 2020-21 onwards, the maximum limit for deduction u/s 80D in respect of payment made for health insurance premium in respect of a Senior/Super Senior citizen has been allowed at Rs.50,000/-.
• A deduction is allowed upto Rs. 50,000/- for medical expenses incurred on the health of a Senior/Super Senior citizen provided no amount is paid for health insurance of such person.
• Both deductions can also be claimed by Taxpayer who is a senior citizen and also has Senior/super senior citizen parents. For e.g. If the tax-payer pays medical premium for Self and incurs medical expenses for parents, or vice versa.

Note:

(i) For claiming this deduction, it is mandatory that the health insurance premium/ medical expenses are paid by any mode other than cash.

(ii) For other individuals the maximum limit of deduction u/s 80D is Rs. 25,000/-.

Deduction in respect of maintenance and medical treatment of a dependent with disability-Section 80DD

• A deduction from Rs. 75,000/- to Rs. 1,25,000/-, depending upon severity of disability, is allowed u/s 80DD of old tax scheme to a resident Individual or HUF for medical expenditure incurred directly on a dependent with disability, or, through a deposit in a notified Scheme meant for maintenance and medical treatment of such dependent with disability for their lifetime.

Higher Deduction in respect of expenses incurred for Medical Treatment of a specified disease or ailment-Section 80DDB

• Under the old tax regime, a senior/super senior taxpayer can avail deduction upto Rs. 1,00,000/- in respect of Self-medical treatment for specified disease or ailments.
• Under the old tax regime, an Individual or HUF taxpayer can avail deduction upto Rs. 1,00,000/- in respect of treatment of Senior/Super-senior citizen for specified disease or ailments, provided such senior/super citizen is dependent on Individual or a member of HUF.

Note: For non-senior Individual taxpayers and HUF, the amount of deduction available in respect of expenses incurred for medical treatment of self or non-senior citizen dependent/member for specified disease or ailments u/s 80DDB is Rs. 40,000/- under the old tax regime.

Higher Deduction for Interest Income from Bank and Post Office

• A Senior/Super Senior citizen can claim deduction upto Rs. 50,000/- u/s 80TTB, under old tax regime, in respect of interest income earned on savings bank accounts, bank deposits or any deposit with post office or cooperative banks.
• In case such interest income earned by him during the year is less than Rs. 50,000/-, the payer bank/ post office will not deduct any tax from such interest income.

Note: Individual taxpayers other than senior citizens are allowed maximum deduction of Rs. 10,000/- u/s 80TTA in respect of interest income from savings bank accounts.

Eligibility to file Manual Income Tax Return

• A super senior citizen aged 80 years or above filing his return of income in Form SAHAJ (ITR-1) or SUGAM (ITR-4) and having total income of more than Rs. 5 lakh or having a refund claim, can file his/her return of income in paper mode. For such individuals, electronic filing of ITR – 1 or ITR – 4 (as the case may be) is not mandatory.

Note: The Super Senior Citizen may opt for e-filing, if she/he chooses to do so.

Form No. 15H for Non-deduction of Tax at Source

• A Senior/Super Senior citizen may submit declaration in form no. 15H to the deductor for non-deduction of TDS to the effect that tax on his estimated income for the relevant year is NIL. Based on such verified declaration, the Deductor will not make any TDS.

Income tax exemption on Transfer of Capital asset under ‘Reverse Mortgage Scheme’.

The transfer of a residential house property by way of a reverse mortgage as per the Reverse Mortgage Scheme made and notified by the Central Government for Senior/Super Senior citizen, is not liable to be taxed as Capital Gain (Even the loan amount received is not taxable under any other head of income.)

Exemption from filing ITR

The following category of Senior Citizens are not required to file their ITR:-

• Resident Senior Citizens 75 years or moreand
• Having pension income and interest income only from the account(s) maintained with a bank in which they receive such pension.
• A declaration must be submitted to the bank in the prescribed Form 12BBA.

Note:

(i) Applicable from A.Y. 2021-22

(ii) The specified bank shall be responsible for computing their total income and deducting tax thereon after giving effect to various deductions allowable under Chapter VI-A and rebate u/s 87A of the Act.

The above exemption from filing the return is governed by Section 194P.

Details of ITRs to be filed by Senior Citizens

ITR-1(Sahaj)-For senior citizens whose income includes salary/pension, interest from savings accounts/fixed deposits, and rental income from a single residential property. Total income reported must not exceed Rs 50 Lakhs

ITR-2- For senior citizens whose income also includes capital gains from sale of shares, property, or other assets, along with other income of salary/ pension and interest.

ITR-3 or ITR4(Sugam)- For senior citizens whose income includes earnings from any business or profession.

Applicable Tax Rates

In respect of AY 2026-27 a senior citizen/super senior citizen can opt for either old or new tax regime as under:

Old Tax Regime – Income tax rate slabs for senior citizens from 60 to 80 years of age:

Note : Rebate u/s 87-A Resident individual whose Total Income is not more than ₹ 5,00,000 is eligible for a Rebate of 100% of income tax or ₹ 12,500, whichever is less.

Income Tax slabs for super senior citizens (80 years and above in age)

2. New Tax Regime:

a. There is a common slab for all categories of tax payers, including senior citizens and super senior citizens.(AY 2026-27) in New Tax Regime:

b. Rebate u/s 87-A has also been introduced from AY 2024-25 onwards under the new tax regime making income upto Rs. 12,00,000/- as tax free for AY 2026-27.