Contributing to the senior citizen benefits..! CBDT amends form 15H exempting TDS on interest income

Mumbai, May 25: Viewing to simplify the tax procedures and give a due benefit to the senior citizens in effect to the Budget announcement, the Central Board of Direct Taxes have moved up issuing amendments in the Income Tax Form 15H allowing the senior citizens to claim exemption from TDS in interest income on deposits.

 

 

“Senior citizens with a taxable income of up to ₹5 lakh can now submit in banks and post offices Form 15H to claim exemption from TDS on interest income on deposits”, the CBDT said in its notification.

 

Earlier, the limit for seeking TDS exemption was ₹2.5 lakh. The Union Budget 2019-20 has given full tax rebate to individuals having a taxable annual income of up to₹5 lakh, benefitting around 3 crore middle class taxpayers.

The amendments by the CBDT states that banks and financial institutions would accept Form 15H from assessees whose tax liability is nil after considering rebate available under Section 87A of the Income Tax Act, 1961.

 

With this it is necessary for the senior citizens, above 60 years of age, to submit Form 15H to banks at the beginning of a financial year to ensure that no tax is deducted at source on interest income.

 

“At present, the note 10 of Form 15H does not take into account the maximum allowable rebate of Rs 12,500/- provided under section 87A as above, which is available to the assessee in respect of the tax calculated on income”, the official press release said.

 

“There could be cases, where, though income of the assessee would be above the minimum amount chargeable to income-tax, tax liability may be nil after taking into account the rebate available under section 87A. Deduction of tax in such cases may cause undue hardship to senior citizens”, it added further.