1. PENSION
Pension is described in section 60 of the CPC and section 11 of the Pension Act as a periodical allowance or stipend granted on account of past service, particular merits etc. Thus monthly allowance to the younger brother of a ruler was treated as a maintenance allowance and not pension (Raj Kumar Bikram Bahadur Singh Vs. CIT 75 ITR 227(MP)). There are three important features of ‘pension’. Firstly, pension is a compensation for past service. Secondly, it owes its origin to a past employer-employee or master-servant relationship. Thirdly, it is paid on the basis of earlier relationship of an agreement of service as opposed to an agreement for service. This relationship terminates only on the death of the concerned employee.
Pension received from a former employer is taxable as ‘Salary’. Hence, the various deductions available on salary income, including relief u/s 89(1) for the arrears of pension received would be granted to pensioners who received their pension from, a nationalised bank and in other cases their present Drawing & Disbursing Officers. Similarly, deductions from the amount of pension of standard deduction and adjustment of tax rebate u/s 88 and 88B shall be done by the concerned bank, at the time of deduction of tax at source from the pension, on furnishing of relevant details by the pensioner. Instructions in above regard were issued by R.B.I. ’s Pension Circular (Central Service No. 7/C D.R./ 1992(Ref. No. DGBA:GA(NBS) No. 60/GA64-(II CVL-91-92 dated 27.4.92).
Pension to officials of UNO is exempt from taxation. Section 2 of the UN (Privilege & Immunities) Act, 1947 grants tax exemption to salaries/emoluments paid by U.N. The Karnataka High Court had held that u/s 17 of the Income Tax Act, salary has been defined as including pension, therefore, if salary received from U.N. is exempt, so shall be the pension. This decision was accepted by the CBDT vide circular No. 293 dated 10.02.1981.
2. FAMILY PENSION
Family pension is defined in Section 57 as a regular monthly amount payable by the employer to a person belonging to the family of an employee in the event of death. Pension and family pension are qualitatively different. The former is paid during the lifetime of the employee while the latter is paid on his death to surviving family members. However, in case of family pension, since there is no employer-employee relationship between the payer and the payee, therefore, it is taxed as ‘Income from Other Sources’ in the hands of the nominee(s). In respect of family pension, deduction u/s 57(iia) of Rs. 15000 or 1/3rd of the amount received, whichever is less, is available.
3. SENIOR CITIZEN
Under the Income Tax Act, a senior citizen is a person who at any time during the previous year has attained the age of 60 years or more. There are certain benefits available to senior citizen under the Income Tax Act:-
(i) The maximum amount not chargeable to tax in respect of senior citizens is Rs.3,00,000. Thus, no tax is payable by a senior citizen if the total income is upto Rs.3 lacs.
(ii) The deduction available u/s 80D for medical insurance premium paid is to be increased to Rs.50,000 for senior citizens. Secondly, the deduction available u/s 80DDB in respect of expenditure incurred on treatment of specified diseases is to be increased to Rs.1,00,000 for senior citizens.
(iii) In order to resolve the tax issues arising out of the reverse mortgage scheme a new clause (xvi) in Section 47 of the I.T. Act which provides that any transfer of a capital asset in a transaction of reverse mortgage under a notified scheme shall not be regarded as a transfer and shall, therefore, not attract capital gains tax. This ensures that the intention of a reverse mortgage which is to secure a stream of cash flow against the mortgage is not contradicted by treating the same as transfer.
The second issue is whether the loan, either in lump sum or in installments, received under a reverse mortgage scheme amounts to income. Receipt of such loan is in the nature of a capital receipt. However, with a view to providing certainty in the tax regime pertaining to the senior citizens, the section 10 of the Income Tax Act has provide that such loan amounts will be exempt from income tax.
Consequent to these amendments, a borrower, under a reverse mortgage scheme, will be liable to income tax (in the nature of tax on capital gains) only at the point of alienation of the mortgaged property by the mortgagee for the purposes of recovering the loan.
4. SUPER SENIOR CITIZEN
Under the Income Tax Act, a Super senior citizen is a person who at any time during the previous year has attained the age of 80 years or more . There are certain benefits available to senior citizen under the Income Tax Act:-
(i) maximum amount not chargeable to tax in respect of senior citizens is Rs. 5,00,000/-. Thus, no tax is payable by a Super senior citizen if the total income is upto Rs.5 lacs.
(ii) All benefit discussed in point (ii) & (iii) above for Senior Citizens are also available to Super Senior Citizens.
My Pention Income Rs. 3,66,467.00
Interest Received from Fixed Deposit is Rs.3,13,617.00
Interest from S.C.S.S. is Rs. 89,200.00
Interest from Term Deposit is 31,812.00
Interest from Savings Account is Rs. 5,000.00
How do I calculate my Income Tax. Please Help.
I will be grate full if Calculation process will be suggest.
Is a super senior citizen eligible to pay interest under section 234ABC for fy 19-20
My mother receives pension and family pension both. Is she can claim both deduction of rs 50000 and 15000 .
Sir
I am a retiree from HVPN/HSEB and Senior citizen of 72 years getting pension from SBP.
AS per Income tax department Section 207 I am exempt from paying Advance tax. But Bank have started dedudcting tax from my pension inspite my objection. You are requested to help me.
With warm regards
9416046227
I am a central govt emplyee and going to retire on 31st May 2017. I want to tranfer 50 percent of my retirement benefits to my husband whose monthy pension is rs. 900 only. Can i do it to save tax.
I have saved Rs 11 lackhs in Banks as fixed deposits, Rs75000 as 5 year term deposits, Rs2,00,00 in post office savings. How much benifits i get
My mother age 74, is drawing a Family pension from the railway amount of 10,500 per month. She has a Pan card , but has never filed returns, could you please advise what kind of Tax payment should she be filing ?
I have a query are psychiatric persons exempted from tax
I have a doubt sir. I am 76 years old. My income for the past few years is in tax paying slab. I am having psychiatric problem regularly taking medicines am I eligible for tax exemption any section relating
i had retired on 2012 march 20 i had been victimized by the employer not having any retirement tax benefit. at the last moment they rendered making payment 47170/ at the last 23rd march with a deduction of 4462/ as income tax whether i can get tax rebate please clarify
Under which section of IT Act 1961,senior citizen need not deposit advance income tax.He can assess his income tax himself and not required to pay income during the financial year concerned,he can deposit his assessed income tax in bank before filling his return of income in the concerned assessment year.
I am aged about 73…iam a state govt. pensioner… last year my pension is crossed the income tax slap limit..including arrears… my question is arrears is taxable ? please clarify.. thanks
NOW I AM 66 YEARS I WANT SALES MY LAND AT TIRUCHY I AM ELIGIBLE FOR IT. LAND VALUE 30,000/- GOVERNMENT RATE. PL SUGGEST ANY RULES WITHOUT PAY THE IT. PLEASE SUGGEST YOUR RULES. I WANT DISBURSE MY AMOUNT TO DAUGHTER.SON AND MYSELF IN FDR
Sir, I am a pensioner, getting Rs 25,000/-.I retired on 31 Jul 2014.Presently I am staying in a rented house costing Rs 8500/-per month. Can I get income tax rebate on house rent. If yes, what I have to do?
Regards,
Apropos my query re allowances to High Court Judges,some more facts are relevant:1.The allowance is not paid by any pension authority not does it reflect in payslip
2.Sanctioned by Govt of Mah. not under their usual pension head accounts but under the account head of High Court expenditure
3.It is paid by the Deputy registrar of the High Court through bank(e.g.state bank of Hyderabad for Aurangabad)on acquiring through the judges information from the concerned judges individually
4.In a way the allowance is expenditure incurred by the High Court for facilities mentioned in Resolution of Govt of Mah.
Govt of maharashtra has allowed Rs 12000 p.m. as allowance for secretarial and other matters wef July 2014 to the retired Judges of Bombay High Court. Will this be chargeable for income tax?
I am a retired state govt employee and received retirement gratuity leave encashment commuted value of pension LIc etc under what section or rule I can claim exemption of tax
are the monthly pensions from L I C ‘s JEEWAN SURAKHA , VARISHT BHIMA PENSION YOJANA exempted from income tax
my income from pension is 260000.Can i avail 2000 rebate as applicable to as my pension is less than 5 lakh. is 2000 rebate is applicable to pensioners also
please clarify
MAY I CLAIM STANDARD DEDUCTION OF 2,50,000/- OF SENIOR CITIZEN DURING F.Y.2012-13 SINCE MY DATE OF BIRTH IS 25/04.1952
MY DATE OF BIRTH IS 25TH APRIL 1952 . CAN I CLAIM STD. DEDUCTION OF RS.2,50,000/-AS PER I.T.ACT DURING F.Y.2012-13 I.E. ASS.YR.2013-14 AS SENIOR CITIZEN OF 60 YERAS
MY DATE OF BIRTH IS 25TH APRIL 1952 CAN I CLAIM STANDARD DEDUCTION OF SERIOR CITIZEN 0E RS. 2,50,000/- DURING ACCOUNTING/FINANCIAL YEAR 2012-13 I.E. ASS. YR.2013-14 -BHARAT KATE
i am pensioner from central gov. civil category.no income from any other source. annual pension is slightly above rs.25000/-getting through sbi guna (mp). pension releasing sbi branch deducted tds.i having full saving up to rs.100000/-.i am repaying house loan emi rs.6000/-p.m.in the same sbi branch.bank didn’t asked me for saving details at the time of tds. for year 2012-13. what should i do where as per rules advance tax is not mandatory in my case.please advise.
Dear Experts Connected with Income Tax and Human Resources!
Kindly Enligheten me abt the below given queries:
1) Is there any rule/law of Any Indian Govt. Department, which prohibits employment of Persons aged 65 Yrs and above, on regular Salary basis, if the Private Company Owners/Management and the Senior Citizen mutually agree to employ and be employed respectively?
2) PF deducyion is Manadatory, irresoective of Age and Salary Drawn?
3)Is there any Rule prohibiting Employment of any Experienced Individual(especially Senior Citizens) on Consolidaated salary basis? That is without Categorising the emoluments under the Sub Heads of Basic Salary/House Rent Allowance /DA ETC ETC?
I am prepared to pay any reasonable fees, if te replies are given, quoting the relevant Rules/Regulations/Acts etc
Regards.
K.Ramesh
E Mail ID rameshkuruganti2010@gmailcom
Mobile Phone:+919949788012
getting gross pension 25000 including commutition 2500 consump loan 5200 am i taxable when i have an ins poll with SA 2.5lac paid ist inst 25000 in dec 2012
My mother is getting pension of 4800 PM and also
Deposited in Bank 400000.
will she be eligile for furnshing form 15H.
Dear Saxena please read the article carefully. The first para mentions.
Under the Income Tax Act, a senior citizen is a person who at any time during the previous year has attained the age of 65 years or more (Age Limit been reduced to 60 Years from A.Y. 2012-13)
sir,
I am retiring in the month of January-2013
Will my pay will be calculated for the purpose of Income Tax as Sr. Citizen in the month of January-2013 ?
my date of birth 21/1/1953
Please clarify for the fin. year 2012-13.
MY DATE OF BIRTH IS 25TH APRIL 1952 CAN I CLAIM FOR STANDARD DEDUCTION OF RS. 2,50,000/- FOR ACCOUNTING YEAR 2012-2013 AS PER I.T.ACT
MY DATE OF BIRTH 25TH APRIL 1952 CAN I CLAIM FOR STD. DEDUCTION 0F 2,50,000/- FOR ACCOUNTING YEAR 1012-2013
current age 84 yrs. Own house resident since 1984 bought at 5 L. wishes to sell at 60 L. What are my tax obligations? At this age i wish to invest the entire proceeds in normal bank Fixed Deposits.
My date of birth is 01-04-1932.
Can I claim the super senior citizen benefit regarding exemption limit of Rs. 5L for the financial year 2011-2012
what about the new category of super senior citizens?
I am Central Government Pensioner and widower residing in a rented Flat in Chennai to look after my children. . I own one flat in Kolkata, but it is kept under lock and key, not rented. Can I claim deductions for house rent paid by me from my Pension Income. I was not advised earlier in this regard and have never claimed deduction. If the answer to my first point is ‘yes’, can I file revised returns for earlier years claiming deductions for house rent paid as admissible.
I think the age for Senior Citizen has been reduced to 60 years in the Financial year 2011-12 i.e. Assessment year 2012-13.Please clearify.
My date of birth is 21.06.1947. I am a Pensioner of the Central Government Service. Kindly clarify whether the CBDT circular No. 293 dt. 10.02.1981 quoted above accepting Karnata High Court Judgment u/s. 17 of the IT Act stating that Pension from UN is not taxable, is applicable to all pensions or only for the pension from UN.
Nothing to comment in this country. Simple things are making complex in all sections of regulators .getting fade up. Government / Politicians are trying their level best to retain their seats in respective Constituencies and ensure their monthly Allowance /salary / gratuity / Pension etc. making Public / masses AMM Admi are not full. Early General Election with no majority of any party is round the corner 2012/ 2013/ March 2013. by this time loot every one.
CA subhash Chandra Podder
Kolkata
24/01/2012
as per my information , the age limit for being a senior citizen under income tax act is now 60 yrs, whereas in this article., it is written as 65 yrs. please clarify.
thanks
dr ak saxena