The Narendra Modi government's Interim Budget 2019 offered a number of steps that could help reduce the tax burden on senior citizens. While Minister Piyush Goyal did not announce any changes to the income tax slabs for senior citizens and super senior citizens, he did announce measures that senior citizens could use to reduce their tax liabilities.
Along with the proposed move to remove income tax for those with income below Rs 5 lakh, Goyal also pointed out that deductions of medical expenditure on senior citizens could be used to bring the taxable income below the Rs 5 lakh threshold.
He announced the raising of TDS threshold on two categories of earning, from which senior citizens could potentially benefit. First, he proposed raising the TDS threshold on interest earned from bank and post office deposits from the present Rs10,000 to Rs40,000.
Second, he proposed raising the TDS threshold for income from rent from the present Rs 1.8 lakh to Rs 2.4 lakh per annum.
Goyal also proposed to exempt the levy of income tax on notional rent on a second self-occupied house, saying it would help people who have to maintain two different houses for a number of reasons, among them being the care of parents. While this may not directly impact all senior citizens, it could help alleviate tax burden to an extent for some senior citizens or their family members.
The increase in standard deduction from Rs 40,000 to Rs 50,000 would also deliver benefit to senior citizens, Goyal said. He also spoke about the rationalisation of processes of pension schemes.