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Senior citizens above 75 exempted from ITR filing under Section 194P: Key details
Babushahi Bureau
Chandigarh, April 9, 2025 – Senior citizens aged 75 and above have reason to rejoice as the Income Tax Department offers relief from the burden of filing Income Tax Returns (ITR) under Section 194P of the Income Tax Act, 1961.
Introduced through the Finance Act, 2021, and effective since April 1, 2021, this provision simplifies tax compliance for elderly individuals whose income is restricted to pension and interest, provided they meet specific conditions.
To avail of this facility, eligible senior citizens must submit Form 12BBA—a declaration form—to their respective banks.
This form requires details such as the PAN number, Pension Payment Order (PPO) number, total income, deductions claimed under relevant sections (e.g., 80C to 80U), eligibility for exemption under Section 87A, and confirmation that their income comprises only pension and interest.
Additionally, they must specify the name of the bank and the pension-paying employer.
Once submitted, the bank calculates the individual’s total income (pension plus interest), applies applicable exemptions and deductions as per the Income Tax Act, and deducts Tax Deducted at Source (TDS) accordingly.
This process eliminates the need for senior citizens to file an ITR, offering significant relief to those who find tax filing cumbersome.
Conditions for Eligibility
The exemption applies only to:
- Residents of India aged 75 or older.
- Individuals whose income is limited to pension and interest earned from the same bank disbursing their pension.
- Pensioners banking with a ‘Specified Bank’, as notified by the government.
Old vs. New Tax Regime
Senior citizens opting for the old tax regime must provide proof of investments (e.g., under Section 80C) to claim deductions accurately.
Conversely, those choosing the new tax regime need not submit investment proof, as most exemptions are not available under this system.
This flexibility allows elderly taxpayers to select the regime that best suits their financial situation.
A Step Toward Simplification
Section 194P aims to ease the tax compliance burden for senior citizens with limited income sources. With the 2025 ITR filing season underway and updates made to Excel utilities for certain ITR forms, this provision stands out as a boon for the elderly.
Experts suggest that families with eligible senior members verify their eligibility, as it could spare them the complexity of annual tax filing.