Latest Income Tax Slab Rates For Senior Citizens FY 2018-19 AY 2019-20
New income tax Slab Rates for senior citizens are now all set to benefit them in many way.
If senior citizens are aware of the new tax Slab Rates,they will definitely get tax benefits.
Now we will discuss the new remarkable changes in case of senior citizens.:
- Under section 80DDB SENIOR CITIZENS now can take Rebate of rs 80,000 on expenditure incurred on specified diseases.
- Upto Rs 50,000 they can take Rebate on income earned in the form of interest from BANK FD,RD ,POST OFFICE SAVING ACCOUNT AND SAVING BANK ACCOUNT.
- EDUCATION CESS increased from 3% to 4%.
- Standard Deduction of rs 40000 is applicable on taxable income.
- Hike in health insurance Deduction from rs 30,000 to 50,000.
- There is no TDS Deduction for senior citizens under section 194A.
How to calculate income tax for senior citizens
Suppose your income from pension is 7 lakhs.
Also let your saving are 150,000 under section 80C.
So your taxable income becomes 550,000.
As per standard Deduction of rs 40,000 applicable from Budget 2018.
Deduct 40,000 from 550,000.it will become 510,000.
Further upto first 3 lakhs there is no tax for senior citizens.
Hence deduct 300000 from 510,000.
So taxable amount becomes 210,000.
As you know upto 5 lakhs tax rate is 5%.
So we separate 210000 to 200000 and 10,000.
Take 5% of 200000 and 20% of 10,000.
Hence tax becomes 10,000+2000=12000.
Also education cess of 4% of 12,000 is 480.
Add rs 480 to 12,000 becomes 12480.
Finally your tax is 12480.
You can also take tax benefits under sections 80DDB,80D if it is applicable in your case.
At the end it is obvious that senior citizens can wisely take tax benefit in the latest income tax Slab Rates for AY 2019-20.