Union Finance Bill 2021–Budget 2021 inserted new section 194P conditional relaxation for senior citizen who are the age 75 years or above from filing Income Tax Return.
The provisions of Section 139 shall not apply to a specified senior citizen for the Assessment Year relevant to the previous year in which tax is deducted.
Section 139 of the Act provides for filing of return of income. Sub section (1) of the section provides that every person being an individual, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceed the maximum amount which is not chargeable to income tax, shall on or before the due date, furnish return of income.
In order to provide relaxation to senior citizens aged above 75 years or more, it is proposed to insert a new section 194P for filing ITR.
The following conditions to be satisfied:-
1) Who is the age of 75 years or more anytime during the previous.
2) Who is having income of the nature of pension and other income except the income of the interest received or receivable from any account maintained by such individual in the same specified bank in which he is receiving his pension income.
He has to furnish a declaration to the specified bank containing such particulars, in such form & verified in such manner as may be prescribed.
Once, the declaration is furnished, the specified bank shall after giving effect of deduction allowable under Chapter VI-A and rebate allowable under section 87A, compute the total income of such specified senior citizen for the relevant Assessment Year & deduct income tax on such total income on the basis of rates in force.
a) “specified bank” means banking company as the Central Government may, by notification in official Gazette specify .
b) “specified senior citizen” means an individual being a resident in India.
This amendment will take effect from 1st April, 2021.