Higher Deduction in respect of interest income to senior citizen under section 80TTB
At present, a deduction upto Rs 10,000/- is allowed under section 80TTA to an assessee in respect of interest income from savings account. It is proposed to insert a new section 80TTB so as to allow a deduction upto Rs 50,000/- in respect of interest income from deposits held by senior citizens. However, no deduction under section 80TTA shall be allowed in these cases.
This amendment is effective from 1st April, 2019 and will, accordingly, apply in relation to the assessment year 2019-20 and subsequent assessment years.
| Particulars | Old Provision of section 80TTA |
New Provision of Section 80TTB |
| Deduction for senior citizens in respect of Interest income | Deduction Allowed upto Rs.10000/- for Saving Account Interest u/s 80TTA | Deduction allowed upto Rs.50,000/- for FDR and Saving Interest u/s 80TTB |
Section 194A also been amended by Budget 2018 so as to raise the threshold for deduction of tax at source on interest income for senior citizens from Rs 10,000/- to Rs 50,000/-.
This amendment takes effect, from 1st April, 2018.
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Extract of Relevant Clause 29, 30 & 47 of Finance Bill 2018
Clause 29 of the Bill seeks to amend section 80TTA of the Income-tax Act relating to deduction in respect of interest on deposits in savings account.
The said section, inter alia, provides that where the gross total income of an assessee, being an individual or a Hindu undivided family, includes any income by way of interest on deposits in a savings bank account with certain entities.
It is proposed to amend the said section so as to provide that the assessee referred to in section 80TTB shall not be eligible for the benefit of deduction under this section.
This amendment will take effect from 1st April, 2019 and will, accordingly, apply in relation to the assessment year 2019-2020 and subsequent years.
Clause 30 of the Bill seeks to insert a new section 80TTB in the Income-tax Act relating to deduction in respect of interest on deposits made by senior citizens.
The proposed new section, inter alia, provides that where the gross total income of an assessee, being a senior citizen, includes any income by way of interest on deposits with a banking company to which the Banking Regulation Act, 1949, applies (including any bank or banking institution referred to in section 51 of that Act) or a co-operative society engaged in the business of banking (including a co-operative land mortgage bank or a co-operative land development bank) or a Post Office as defined in clause (k) of section 2 of the Indian Post Office Act, 1898, a deduction of an amount up to fifty thousand rupees shall be allowed.
It is further proposed to provide that where the income referred to in this section is derived from any deposit held by, or on behalf of, a firm, an association of persons or a body of individuals, no deduction shall be allowed under this section in respect of such income in computing the total income of any partner of the firm or any member of the association or any individual of the body.
It is also proposed to define the expression “senior citizen”.
This amendment will take effect from 1st April, 2019 and will, accordingly, apply in relation to the assessment year 2019-2020 and subsequent years.
Clause 47 of the Bill seeks to amend section 194A of the Income-tax Act relating to interest other than “interest on securities”.
The said section, inter alia, provides that where the amount of income or, as the case may be, the aggregate of the amounts of income credited or paid or likely to be credited or paid during the financial year by the person, does not exceed ten thousand rupees, where the payer is a banking company to which the Banking Regulation Act, 1949 applies (including any bank or banking institution, referred to in section 51 of that Act); or co-operative society engaged in carrying on the business of banking; or on any deposit with post office under any scheme framed by the Central Government and notified by it in this behalf; or five thousand rupees in any other case, no tax at source is required to be deducted.
It is proposed to amend the said section so as to provide that in case of senior citizen, the said interest amount is increased to fifty thousand rupees.
It is also proposed to define the expression “senior citizen”. These amendments will take effect from 1st April, 2018.
Republished with amendments
I became sr citizen on aug 20. In fin year 2020-21 I got rs 85000 intt on FDR how much amount is taxable infer section 80 ttb
already submitted my ITR1 and got verified and accepted, but did not claim deduction in 80TTB. Can I claim now and how?
As I have take the benifit of TTA B for AY 2019 20 . And i have already filed the return. Can i claim dat 50000 deduction amount by rectification of return
I am sr.citigen 74 yrs. I have 5500 as sb account int and 10500 as fd interest. Can I claim both amounts as deduction. Kindly clarify.
I am a senior citizen. Interest on FD in Bajaj Finance is eligible t under Sec.80 TTB.
Sir
I am pensioner can I claim 80 ttb benefit
Kindly inform in my email
Thanks
i am senior citizen(60 years)
i have post office deposit ( senior citizen saving scheme) interest on the same is Rs78,775/-
may i eligible u/s 80ttb up to Rs 50000/-
I am senior citizan(60 years)
I have post office senior citizan saving scheme deposit
interest on same will dedction under 80ttb up to Rs.50000/= in A Y 2020-21 can allow ?
Before becoming NRI,SCSS a/c in operation could be eligible for 50000 under 80TTB for FY2018-19?
Kindly clarify whether deduction u/s 80TTB is equally permissible to super Senior citizens?
Is deduction under section 80 TTB also applicable to Super Senior Citizens?
I am a pensioner of age 67.
I have occasionally earned money from ‘Other Sources’ by way of professional consultancy and have declared it in Schedule OS. Am I allowed a deduction on account of this, and where do I claim this on ITR 2 ?
Is NCD intrests comes under the purview of 80TTB
I mean is it taxable
For financial year investment 170000 as SBI life and NSC bonds
.I am a senior citizen. Can I deduct 150000/ as savings.And interest on fd and savings bank account in all RS.30000/.We can deduct 150000/ in savings.where to deduct RS 30000/ while taking as income.or overall deduction RS 150000/
can some one explain whether a retired central government employee avail both standard deduction of 40,000 as well as deduction of 50,000 under 80ttb as he is a senior citizen as well
Sir i have a fd with LIC can I avail the deduction on intrest recieved under section 80ttb