In a bid to make senior citizens financially independent, the government introduced section 80TTB in 2018.
What is section 80TTB?
Section 80TTB of the Income Tax (IT) Act facilitates senior citizens to claim up to Rs 50,000 as tax deductions during that financial year.
80TTB: Tax deductions available
Under section 80TTB, a senior citizen, who is an Indian resident, can claim upto Rs 50,000 tax deduction on
- Interest income from a savings account, fixed deposit or recurring deposit with banks
- Interest income on post office deposits
- Interest income on deposits with specific institutions, such as cooperative housing societies
To claim tax deductions under section 80TTB, a senior citizen should file IT returns under the heading, ‘Income from other sources’.
See also:Â Section 80C: All you need to know
80TTB: Tax deductions not available on
These deductions are not available on
- Interest income from debentures, bonds or other security instruments
- Interest on deposit held on behalf of a firm
- Body of individuals (BoI)
- Association of Persons (AOP)
Non-resident Indians cannot take advantage of the 80TTB tax deductions.
Section 80TTB and Section 80TTA: Differences
| Features | Section 80TTB | Section 80TTA |
| Eligibility | Applicable to senior citizens (60 years and above) | Applicable to individuals and Hindu Undivided Family (HUF) except senior citizens |
| Specific income for a tax deduction | Interest earned on all deposits made in banks, post offices and specific institutions | Interest earned on savings account deposits |
| Deduction upto | Rs 50,000 | Rs 10,000 |
| Eligibility for NRIs | NRIs cannot claim tax deductions under Section 80TTB | NRIs can claim tax deductions under Section 80TTA |
Section 80TTB: Documents required to apply
For applying for tax deductions under section 80TTB, you need the following documents:
Section 80TTB: How it benefits senior citizens?
Suppose a senior citizen and a normal taxpayer have got following interest on their earnings.
Savings account interest: Rs 5,000
Fixed deposit interest: Rs 2,00,000
Other sources of income: Rs 1,50,000
| Details | Senior citizen | Non-senior citizen |
| Savings account interest | Rs 5,000 | Rs 5,000 |
| Fixed deposit interest | Rs 2,00,000 | Rs 2,00,000 |
| Other sources of income | Rs 1,50,000 | Rs 1,50,000 |
| Total income | Rs 3,55,000 | Rs 3,55,000 |
| Tax deductions under Section 80TTA | Not applicable | Rs 5,000 |
| Tax deductions under Section 80TTB | Rs 50,000 | Not applicable |
| Taxable income | Rs 3,05,000 | Rs 3,50,000 |
FAQs
What are the documents required to claim 80TTB tax deductions?
To claim 80TTB tax deductions, senior citizens need a PAN card, investment account statement/passbook and Form 16.
Are tax deductions under 80TTB applicable for NRI senior citizens?
No, NRI senior citizens are not eligible for tax deductions under 80TTB.
