The Finance Minister has taken some steps in the current budget to address the concerns of senior citizens.
In a few sweeping moves he has covered their concerns about income and health and the benefits are expected to kick in from April this year.
Exemption of interest income on deposits with banks and post offices will be increased to Rs 50,000 from Rs 10,000 earlier. This benefit will be extended to all fixed deposits and recurring deposits.
The investible amount for Pradhan Mantri Vaya Vandana Yojana has been raised to Rs 15 lakh from Rs 7.5 lakh. In this scheme, senior citizens get an assured return of 8 per cent from LIC. This scheme, specially directed for senior citizens has been extended till March 2020.
Health related issues and the expenses incurred as a result often erode away huge chunks of savings for senior citizens. In an effort to give them some relief, critical illness tax deduction for senior citizens has been raised to Rs 1 lakh. Earlier the tax concession was Rs 60,000 for senior citizens and Rs 80,000 for very senior citizens. This deduction comes under Section 80DDB of the Income-tax Act, 1961 for senior citizens for medical treatment of specified diseases.
The Finance Minister also increased the limit of deduction for health insurance premium and medical expenditure to Rs 50,000 from Rs 30,000 under Section 80D. This additional deduction of Rs 20,000 will help a taxpayer save up to Rs 6,240 per annum.
The grey haired denizens of India will also enjoy the benefits of standard deduction of Rs 40,000 that the government has reintroduced.
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