Tax related SCSS/PMVVY schemes

Tax related SCSS/PMVVY schemes

Hi,

My mother aged 73 years. receving pention around 12000 per month.
In additon to this we we want to have SCSS (senior citigen savings scheme) for 15lakhs ( at 8.6% per annum)
on her name. I Would like to know the tax implication. How much tax exacly she needs to pay with the scheme sadi above.

Thanks
Ravi

Asked 5 years ago in Income Tax

Hello,

The total income of your mother would be below the basic exemption limit applicable to a senior citizen assessee. Hence no tax would be payable.

Further investment in SCSS A/c. is eligible for deduction u/s. 80C. Interest from such A/c. is taxable but a senior citizen can claim deduction u/s. 80TTB for the maximum up to Rs 50,000 in a single financial year.

If TDS is deducted by the bank/post office on the interest, the income tax return of your mother can be filed to claim the refund.

I hope that this answer satisfies your requirements.

Regards,

CA Hunny Badlani

Hunny Badlani

CA, Madhya Pradesh

2608 Answers

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Talk to Hunny Badlani

Dear Ravi,

Here is my reply to your query:

Computation of Income - Financial Year- 2019-20

Income under the head salary (Pension) - (12000*12)- 1,44,000

Income under the head other sources (Interest)- (15,00,000*8.6%)- 1,29,000

Total Income - 2,73,000

In case of an Individual (age above 60 years but less than 80 years)- There is no tax liability up to Rs. 3,00,000.

Also, investment in SCSS is tax free and your mother will get the deduction from the taxable income up to maximum of Rs. 150000.

Thanks and Regards

Divya Chugh

CA, Noida

190 Answers

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Talk to Divya Chugh

zero tax considering the above two income.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

Naman Maloo

CA, Jaipur

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Talk to Naman Maloo

Hi Ravi,

Hope you are doing well !!

There would be no tax liability on her as her income would be below the basic exemption limit.

Payal Chhajed

CA, Mumbai

5188 Answers

299 Consultations

Talk to Payal Chhajed

Dear Sir,

For the Senior Citizens exemption limit for charging tax is Rs. 3,00,000/-. As in your mother's case the total income is not crossing Rs. 3,00,000/- there is no tax liability.