Are you eligible for this deduction?

If you fulfil the following conditions, then you are eligible to claim a deduction for ₹ 50,000 from your income for the purpose of computing taxes as per the income tax law in India.

Do you have any income from interest on deposits made by you? Are these interest incomes from deposits you have made in

  1. Both private and Nationalized banks that are covered by Banking Regulation Act., ie., these are banks that follow regulations laid down by RBI.

  2. Co-operative societies engaged in banking business.

  3. Post office deposits.

The next question to be answered is ARE YOU A SENIOR CITIZEN who is RESIDENT in India?

If your answer to both the above questions is a YES, then you are eligible to claim a the interest income as deduction while

computing your taxes. If the interest is greater than ₹ 50000, then you get to claim a maximum deduction of ₹ 50000 only. For example, if your interest income from above sources is ₹75000 then you get to claim a deduction of ₹ 50000 only and the balance ₹25000 is taxed. On the other hand if your interest income is ₹37000, then you can claim the entire ₹37000 as deduction.

But, How to figure out whether I am a SENIOR CITIZEN?

Its quite simple for the Assessment year 2021-22, if your 60th birthday (as per the date of birth you have provided to the income tax department) falls between 1st April 2020 & 31st March 2021, then you are a senior citizen for the purposes of Income tax law. You can apply the same logic for the various years that you may need.

How do I know you are serious about this and you are not pranking me about this deduction?

Well all you have to do is read through section 80TTB of the Income tax Act 1961. This section provides us with the details of this deduction.

We hope we left you happy with a new avenue to save your tax bill. Please do get in touch with us to help you even more.

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