Claim Settlement Ratio of 99.23%~

Close Button Close Button
X
NRI Services Helpline

Calling FromPhone Number (Toll Free)
AUSTRALIA80037371371
CANADA
HONG KONG
ISRAEL
MALAYSIA
NEW ZEALAND
PHILIPPINES
SINGAPORE
THAILAND
UNITED KINGDOM
BRUNEI8014605
INDONESIA0018030160202
JORDAN080023194
OMAN80074363
TURKEY00800142030059
VIETNAM1800400070
UNITED STATES18339680951
Calling us from INDIA18002097272
Rest of the World+912067871700
(Call charges apply)

Tax FAQs For Senior Citizens

The Income Tax Act, 1961, defines different tax rates for individual taxpayers basis their age and income. Under the old tax regime, there are different tax slabs for different age group. Individuals aged 60 years or above are considered senior citizens and accordingly they fall under specified tax slab. Moreover, the tax provisions also have different rules for senior citizens when it comes to tax-saving avenues and investments. So, here are some common tax-related FAQs that senior citizens might have while filing their Income Tax returns along with their answers.

Investment plans also act as tax-planning tools, as many avenues help reduce tax liability. There are different types of investment plans, and by choosing the right one, you can invest according to your needs and grow your savings.Read Less

Get in Touch to Know More
I agree and consent to the Terms & Conditions, Privacy Policy
Get Your Life Goals, Done!

Tailored Life Insurance Solutions for your long-term Life Goals.

Written ByPalak Bagadia
AboutPalak Bagadia
LinkedIn Icon
Palak Bagadia, Associate – Digital Marketing at Bajaj Allianz Life, with experience spanning content and performance marketing, recruitment, employee engagement in the BFSI industry.
Reviewed ByRituraj Singh
AboutRituraj Singh
LinkedIn Icon
Rituraj Singh,With over 6.5 years of experience in the insurance industry, Rituraj Singh, Manager- Product & Brand Marketing at Bajaj Allianz Life Insurance overlooks new product launches, compliance, and brand projects, leveraging artificial intelligence and technology to enhance outcomes.
Written on: 7th July 2024
Modified on: 7th July 2024
Reading Time: 15 Mins
Share

 

Tax-related FAQs for senior citizens

 

1. What is the difference between a senior citizen and a super senior citizen?

 

As per income tax rules, a senior citizen is one who is aged between 60 and 80 years1. On the other hand, a super senior citizen is one who is aged 80 years and above1.

 

2. What are the tax slabs for senior and super senior citizens?

 

Under the old tax regime of the act, there are different tax slab for senior and super senior citizens2. However, under the new tax regime, there is a uniform tax slab2 irrespective of the age group. The tax slabs will be as follows –

Under the Old Tax Regime, for senior citizens2

Taxable incomeRate of tax

Up to Rs.3,00,000

Nil

Rs.3,00,000 to Rs.5,00,000

5%(tax rebate u/s 87A is available)

Rs.5,00,000 to Rs.10,00,000

20%

Rs.10,00,000  and above

30%

Under the Old Tax Regime, for super senior citizens2

Taxable incomeRate of tax
Up to Rs.5,00,000Nil
Rs.5,00,000 to Rs.10,00,00020%
Rs.10,00,000 and above30%

Under the New Tax Regime for FY 2022-23:

The tax slabs are as follows2 for both senior and super senior citizens are same as follows–

Taxable incomeRate of tax

Up to Rs.2,50,000

Nil

Rs.2,50,000 to Rs.5,00,000

5%

Rs.5,00,000 to Rs.7,50,000

10%

Rs.7,50,000 to Rs.10,00,000

15%

Rs.10,00,000 to Rs.12,50,000

20%

Rs.12,50,000 to Rs.15,00,000

25%

Rs.15,00,000 and above

30%

However, the new tax regime was modified in the Union Budget 2023$. The modifications are as follows –

  • The minimum threshold limit for tax has been increased to Rs.3 lakhs from the existing Rs.2.5 lakhs.
  • The limit to claim a rebate on income tax has been increased. Taxable income up to Rs.7 lakhs will attract no tax. Earlier, it was Rs.5 lakhs.
  • The new regime has been made default unless chosen otherwise.
  • The new changes will be effective from the financial year 2023-24.

The changed slabs per the new regime are as follows –

IncomeTax rate
Up to Rs.3,00,000Nil
Rs.3,00,000 to Rs.6,00,0005%
Rs.6,00,000 to Rs.9,00,00010%
Rs.9,00,000 to Rs.12,00,00015%
Rs.12,00,001 to Rs.15,00,00020%
Rs.15,00,000 and above30%

Senior citizens can choose from the old or the new regime depending on which regime is tax efficient.

 

3. What are the tax-saving insurance cum investment avenues for senior citizens?

Senior citizens may invest in the different types of life insurance plans available in the market. Some of the plans that they can choose are as follows:

 

• Endowment plans

Endowment plans allow senior citizens to create a secured corpus which is not exposed to the volatility risks of the market. Some plans might also offer bonus or loyalty additions, subject to policy terms & conditions and product features, that can boost the corpus.

 

• Money-back plans

Money-back plans are like endowment plans that help in creating a secured corpus. However, these plans offer liquidity. Senior citizens can get periodic money-back benefits from the plans for their financial needs.

 

• Retirement Plans

Retirement-oriented life insurance policies can help senior citizens plan for their retirement. Senior citizens can choose from two types of retirements plans –

 

• Deferred pension plans -

A deferred annuity plan refers to an investment plan where the pension does not start immediately. Instead, you can choose to start the pension at a later date, after a few years. In this type of plan, you can accumulate the retirement fund for the long-term by paying premium(s) in lump sum or systematically, on a monthly, quarterly, half-yearly or yearly basis. These plans allow individuals to accumulate a corpus and secure pension payments.

 

• Immediate/ Deferred annuity plans –

In an immediate annuity plan, the insurance company agrees to pay the pension immediately (i.e. starting next month/quarter/half-yearly/yearly as opted for) on investing a lump sum amount.

Life insurance plans have tax-saving benefits that can help senior citizens in planning their taxes. Premiums paid for life insurance policies, qualify as a deduction under Section 80C3 subject to conditions specified therein. Overall deduction u/s 80C along with deduction u/s 80CCC & 80CCD allowed is up to Rs. 1,50,000. The death benefit or the maturity benefit also qualifies for tax exemption under Section 10(10D)4, subject to satisfaction of conditions mentioned therein. The premium paid for pension plan also qualifies for a deduction under Section 80CCC5. Moreover, in the case of deferred annuity plans, senior citizens get an option to commute6 a part of the accumulated corpus and get it in a lump sum. This commuted pension is also tax-free6.

So, with life insurance plans, senior citizens can enjoy insurance protection and also create savings while enjoying tax benefits.

 

4. Are there other reliefs that senior citizens can claim under income tax?

Yes, there are other tax-related reliefs offered to senior citizens. Some of them are as follows:

  • Senior citizens that do not earn income from business or profession are exempted from paying advance tax under Section 2077.
  • TDS is not deducted from deposit income earned by senior citizens provided the interest income is up to Rs. 50,000 u/s 80TTB7.
  • No tax is deducted from payment of interest by bank for senior citizen up to Rs. 50,000 u/s 194A.

 

Conclusion

 

So, if you are a senior citizen or if you want to help your parents or other senior citizens with tax planning, understand the income tax provisions for senior citizens. Know the tax slabs and tax-saving options available to senior citizens.

Reference

1. https://www.incometax.gov.in/iec/foportal/help/individual/return-applicable-2#:~:text=An%20individual%20resident%20who%20is,Citizen%20for%20Income%20Tax%20purposes.

2. https://cleartax.in/s/income-tax-slabs

3. https://incometaxindia.gov.in/tutorials/20.%20tax%20benefits%20due%20to%20health%20insurance.pdf

4. https://taxguru.in/income-tax/section-10-10d-exemption-amount-received-life-insurance-policy.html

5. https://cleartax.in/s/section-80ccc#:~:text=Section%2080CCC%20of%20the%20Income,the%20limit%20of%20section%2080C.

6. https://taxguru.in/income-tax/exemption-commuted-pension-section-10-10a.html

7. https://incometaxindia.gov.in/pages/faqs.aspx

BZAZ-WEB-EC-02663/23

Tax Saving Guide

Long term investment plans - What Are Their Benefits?

A suitable financial plan may be defined by its components. Amongst other things, one aspect, it may be incomplete without, is a steady amount of investment.

Read More
Long term investment plans - What Are Their Benefits?

A suitable financial plan may be defined by its components. Amongst other things, one aspect, it may be incomplete without, is a steady amount of investment.

Read More
Long term investment plans - What Are Their Benefits?

A suitable financial plan may be defined by its components. Amongst other things, one aspect, it may be incomplete without, is a steady amount of investment.

Read More
Long term investment plans - What Are Their Benefits?

A suitable financial plan may be defined by its components. Amongst other things, one aspect, it may be incomplete without, is a steady amount of investment.

Read More
Disclaimers:
Plus Symbol
Minus Symbol

#Survey conducted by brand equity – Nielsen in March 2020

~Tax benefits as per prevailing Income tax laws shall apply. Please check with your tax consultant for eligibility.

**Past performance is not indicative of future performance.

$ Subject to the passing of the Finance bill in the Parliament

The above information is for general understanding and is meant to educate the general public at large. The reader will have to verify the facts, law and content with the prevailing tax statutes and seek appropriate professional advice before acting on the basis of the above information.

The views stated in this article is not to be construed as investment advice and readers are suggested to seek independent financial advice before making any investment decisions. For more details on risk factors, terms and conditions please read sales brochure & policy document (available on www.bajajallianzlife.com) carefully before concluding a sale. Tax benefits as per prevailing Income tax laws shall apply. Please check with your tax consultant for eligibility.

X
Disclaimer

*Tax benefits as per prevailing Section 10(10D) and Section 80C of the Income Tax Act shall apply. You are requested to consult your tax consultant and obtain independent advice for eligibility before claiming any benefit under the policy.

~Individual Death Claim Settlement Ratio for FY 2023-2024

1Premium Holiday has to be selected at inception to avail this benefit and also depends on other policy terms & conditions


Bajaj Allianz Life Insurance Co. Ltd. | IRDAI Reg. No. 116

X
Terms & Conditions

I hereby authorize Bajaj Allianz Life Insurance Co. Ltd. to call me on the contact number made available by me on the website with a specific request to call back. I further declare that, irrespective of my contact number being registered on National Customer Preference Register (NCPR) or on National Do Not Call Registry (NDNC), any call made, SMS or WhatsApp sent in response to my request shall not be construed as an Unsolicited Commercial Communication even though the content of the call may be for the purposes of explaining various insurance products and services or solicitation and procurement of insurance business

 

Please refer to BALIC Privacy Policy

X
Disclaimer

%%Above illustration is for Bajaj Allianz Life eTouch- A Non Linked, Non-Participating, Individual Life Insurance Term Plan (UIN: 116N172V03) considering Male aged 25 years | Non-Smoker | Policy Term (PT)– 30 years | Premium Payment Term (PPT) – 30 years | Sum Assured opted is Rs. 1,00,00,000 | Online Channel | Standard Life | 1st Year Premium is Rs. 6,238. 2nd Year onwards premium is Rs. 6,659. Total Premium Paid is Rs. 1,99,349 | Medical Rates | Yearly Premium Payment Mode | Death benefit opted is lumpsum payout and monthly installments (Lumpsum Payout Percentage : 45, Income Payout Percentage : 55) | Premium shown above is exclusive of Goods & Service Tax/any other applicable tax levied, subject to changes in tax laws, and any extra premium and is for illustrative purpose only. This is inclusive of all the discounts mentioned above.

##Tax benefits as per prevailing Section 10(10D) and Section 80C of the Income Tax Act shall apply. You are requested to consult your tax consultant and obtain independent advice for eligibility before claiming any benefit under the policy.Above Tax benefit is calculated considering deduction of Rs. 150,000 and applicable tax rate of 31.20%.

@Term Insurance plan bought online directly from Bajaj Allianz Life Insurance has no commissions involved.

^^The Return of Premium amount is total of all the premiums received, exclusive of extra premium, rider premium and GST & /any other applicable tax levied, subject to changes in tax laws
Bajaj Allianz Life Insurance Co. Ltd. | IRDAI Reg. No. 116

X
Disclaimer

Bajaj Allianz Life eTouch- A Non Linked, Non-Participating, Individual Life Insurance Term Plan (UIN: 116N172V04)

*Tax benefits as per prevailing Section 10(10D) and Section 80C of the Income Tax Act shall apply. You are requested to consult your tax consultant and obtain independent advice for eligibility before claiming any benefit under the policy.Above Tax benefit is calculated considering deduction of Rs. 150,000 and applicable tax rate of 31.20%.

~Individual Death Claim Settlement Ratio for FY 2023-2024

1Premium Holiday has to be selected at inception to avail this benefit and also depends on other policy terms & conditions


Bajaj Allianz Life Insurance Co. Ltd. | IRDAI Reg. No. 116


X
Disclaimer

^Subject to Section 10 (10D) conditions i.e. aggregate annual premium for ULIP policies issued on or after 1st February 2021 does not exceed Rs. 2.5 Lakhs.

1Minimum premium mentioned is applicable for Bajaj Allianz Life Goal Assure IV - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L204V01) and is subject to policy terms and conditions.

#Source: https://economictimes.indiatimes.com/investments-marts/eight-crucial-numbers-to-ensure-financial-success/10-times-the-annual-income-is-your-life-insurance/slideshow/16699748.cms . Subject to availability in Bajaj Allianz Life ULIP Plans. For more details on risk factors, terms and conditions please read sales brochure & policy document (available on www.bajajallianzlife.com ) carefully before concluding a sale.

*Benchmark: Nifty 500 Multicap Momentum Quality 50 Index past 5 CAGR Returns, as on 31st December 2024. Past returns of a fund are not necessarily indicative of the future performance of the fund. | Please consult the financial advisor before investing.

The Unit Linked Insurance Products do not offer any liquidity during the first five years of the contract. The policyholder will not be able to surrender or withdraw the monies invested in Unit Linked Insurance Products completely or partially till the end of the fifth year.

ULIPs are different from the traditional insurance products and are subject to the risk factors. The premium paid in ULIPs are subject to investment risks associated with capital markets and the NAVs of the units may go up or down based on the performance of fund and factors influencing the capital market and the insured is responsible for his/her decisions. Bajaj Allianz Life Insurance Company Limited is only the name of the Life Insurance Company and Bajaj Allianz Life Future Wealth Gain IV - A Unit- linked Non- Participating Individual Life Savings Insurance Plan (UIN:116L202V01), Bajaj Allianz Life Goal Assure IV - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L204V01), Bajaj Allianz Life LongLife Goal III is A Unit-linked Non-Participating Whole Life Insurance Plan (UIN:116L203V01), Bajaj Allianz Life Invest Protect Goal III - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L205V01), Bajaj Allianz Life Magnum Fortune Plus III - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L207V01), Bajaj Allianz Life Goal Based Saving III - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN:116L206V01) and Bajaj Allianz Life Smart Wealth Goal V - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L201V01) are only the name of the unit linked insurance contracts and does not in any way indicate the quality of the contract, its future prospects or returns. Please know the associated risks and the applicable charges, from your Insurance agent or the Intermediary or policy document issued by the insurance company. The various funds offered under this contract are the names of the funds and do not in any way indicate the quality of these plans, their future prospects and returns. For more details on risk factors, terms and conditions please read sales brochure & policy document (available on www.bajajallianzlife.com ) carefully before concluding a sale.

Nifty 500 Multicap Momentum Quality 50 Index Fund is available Bajaj Allianz Life Future Wealth Gain IV - A Unit- linked Non- Participating Individual Life Savings Insurance Plan (UIN:116L202V01), Bajaj Allianz Life Goal Assure IV - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L204V01), Bajaj Allianz Life LongLife Goal III is A Unit-linked Non-Participating Whole Life Insurance Plan (UIN:116L203V01), Bajaj Allianz Life Invest Protect Goal III - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L205V01), Bajaj Allianz Life Magnum Fortune Plus III - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L207V01), Bajaj Allianz Life Goal Based Saving III - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN:116L206V01) and Bajaj Allianz Life Smart Wealth Goal V - A Unit-linked Non-Participating Individual Life Savings Insurance Plan (UIN: 116L201V01)

In addition to the already existing funds, Nifty 500 Multicap Momentum Quality 50 Index Fund is now available with the above mentioned products. Customer has an option to choose from other available funds apart from Nifty 500 Multicap Momentum Quality 50 Index Fund.

X
Terms & Conditions

I hereby authorize Bajaj Allianz Life Insurance Co. Ltd. to call me on the contact number made available by me on the website with a specific request to call back. I further declare that, irrespective of my contact number being registered on National Customer Preference Register (NCPR) or on National Do Not Call Registry (NDNC), any Call made, including via Voice over Internet Protocol & WhatsApp, SMS or WhatsApp messages, in response to my request shall not be construed as an Unsolicited Commercial Communication even though the content of the call may be for the purposes of explaining various insurance products and services or solicitation and procurement of insurance business

close
Ask for an Agent
Sign up for personal visit and tailored advice from our expert agents