With the objective of providing a dignified life to senior citizens, the Union Minister for Finance and Corporate Affairs, Arun Jaitley, announced significant incentives for senior citizens.
Presenting the General Budget 2018-19 in Parliament here today, the Finance Minister said that the exemption of interest income on deposits with banks and post offices to be increased from Rs10,000 to Rs50,000 and TDS shall not be required to be deducted on such income, under section 194A. This benefit shall be available also for interest from all fixed deposits schemes and recurring deposit schemes.
The Finance Minister also announced raising the limit of deduction for health insurance premium and/ or medical expenditure from Rs30,000 to Rs50,000, under section 80D. All senior citizens will now be able to claim the benefit of the deduction up to Rs50,000 per annum in respect of any health insurance premium and/or any general medical expenditure incurred.
Further, the Finance Minister proposed raising the limit of deduction for medical expenditure in respect of certain critical illness from Rs60,000 in case of senior citizens and from Rs80,000 in case of very senior citizens, to Rs1 lakh in respect of all senior citizens, under section 80DDB.
These concessions will give extra tax benefit of Rs4,000cr to senior citizens.
In addition to tax concessions, the Finance Minister proposed to extend the Pradhan Mantri Vaya Vandana Yojana up to March 2020 under which an assured return of 8% is given by Life Insurance Corporation of India. The existing limit on investment of Rs7.5 lakh per senior citizen under this scheme is also being enhanced to Rs15 lakh.