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No tax for super senior citizens up to Rs 5 lakh
October, 19th 2015

I understand that an accrued interest of Rs 10,000 is exempt from income tax. Is my information correct? What would be my tax liability? — Suresh Mathur
The nature of accrued interest has not been indicated in the query. It is presumed that the accrued interest referred to in the query is in respect of accrued interest on a FD. The amount of such accrued interest would be includible in the total income provided you are declaring such income on accrual method of accounting. In case you are declaring such income on cash basis, accrued interest on the FD would not be includible in the total income. Further, your taxable income being below Rs 5,00,000 (being the amount up to which tax is not payable by a person who is of the age of 80 years or more) you are not liable to pay tax and you need not file your tax return.

I am a senior citizen and pensioner from Haryana Government. My pension income for the FY 2015-16 will be around Rs 2.50 lakh besides interest income of FDs to the tune of Rs 1.30 lakh and Rs 1.40 lakh from two different banks, respectively. TDS made by both these banks works out at Rs 13,000 and Rs 14,000, respectively. Deposits made by me in various tax-saving schemes u/s 80C amount to Rs 1,50,000. So my taxable income works out at Rs 3.80 lakh. Thus against my tax liability of Rs 6,180, TDS of Rs 27,000 will be deducted by both the banks emotively.

My query is, being a senior citizen can I submit Form 15H to one of the banks to lessen the amount of my TDS as the TDS even by one of the banks (i.e. Rs 13,000 or Rs 14,000) amply covers my tax liability of Rs 6,180.

According to the provisions of Section 197A(1C) of the Income-tax Act, 1961 (The Act), a senior citizen can file Form 15H in duplicate with the bank provided tax on estimated total income of the previous year in which such a income is to be included in computing his total income will be nil. On the basis of the facts given in the query it may not be possible for you to file Form 15H as your estimated total income in which interest income from bank is to be included would not be nil. You may, however, approach the assessing authority under Section 197 of the Act for passing an order that the tax in your case be deducted at a lower rate.

My father-in-law has gifted Rs 3 lakh to my daughter (minor) out of his retirement benefits for investment in Kisan Vikas Patras in the name of my daughter who is a minor. KVPs were taken from the post offices. Being minor, I was made the guardian till she becomes a major. As the maturity period is more than 8 years when the amount becomes double i.e. Rs 6 lakh (Rs 3 lakh interest accrued).

I am a housewife and have no other source of income. Can I distribute the interest accrued during each financial year in the income-tax return till its maturity? If the interest income is much below the exempt limit for women during the relevant financial year, is it essential to file income-tax return with the Income-tax Department or it may be kept ready for reference and record? Please clarify. — Rajni Sharma

The accrued amount of interest on Kisan Vikas Patras gifted by your father-in-law to his granddaughter (i.e. your daughter) has to be included in your income in accordance with the provisions of the Act. If your total income, including the accrued interest on Kisan Vikas Patras so gifted to your daughter is below the taxable limit applicable to you, you need not file the income-tax return.

 
 
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