New Delhi : Central Board of Direct Taxes (CBDT) notified rules and forms relieving pensioners above the age of 75 years from filing tax returns and authorized their banks to calculate and deduct applicable taxes to be paid to the government.
NS Income tax (26th Amendment) Rules notified by the CBDT specifying the manner of declaration to the bank by a senior citizen eligible for relief. Exemption from filing tax return is available to people above this age and having pension income and interest income in the same bank and gives a declaration to the bank.
This benefit was announced by Finance Minister Nirmala Sitharaman in the Union Budget for FY22.
“In the 75th year of our country’s independence, as we continue our efforts with renewed vigor, we will reduce the compliance burden on our senior citizens who are 75 years of age and above. For senior citizens who have only pension. And there is interest income, I propose exemption from filing their income tax returns. The paying bank will deduct necessary tax on their income,” the minister had said in his budget speech.
The government has now brought in rules and forms that senior citizens will have to file with their bank which in turn will deduct tax on pension and interest income and deposit it with the government.
Interest income has to be earned in the same bank account in which pension is received. Section 139 of the Income Tax Act relating to the obligation to file returns will not apply in these cases.
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