HomeArticlesChanges in the Union Budget 2014-15 and their effects on senior citizens
Changes in the Union Budget 2014-15 and their effects on senior citizens
IndianMoney.com Research Team | Updated On Saturday, May 19,2018, 12:32 PM
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Income tax slabs for the financial year 2013-14 for a senior citizen between 60-80 years of age
Let us consider Mr Gaurav a 62 year old gentleman earns INR 9 Lakhs working in the quality control department of a garment firm. He makes use of the Section 80 C deductions of INR 1 Lakh and invests INR 1.5 Lakh per annum in the senior citizens saving scheme. This amount is tax deductible only up to INR 1 Lakh and he has to pay taxes on the amount exceeding this when calculating his income taxes under Section 80 C of the income tax act.
Mr Gaurav takes up a health insurance policy for himself and gets a deduction of INR 20000 on the premium paid for this policy under Section 80 D of the income tax act as he is a senior citizen. Mr Gaurav has a dependent brother and he claims a deduction of INR 60000 for his treatment under Section 80 DDB of the income tax act by virtue of being a senior citizen.
Mr Gaurav’s income tax liability is calculated as per the income tax slab he falls under.
Mr Gaurav pays an income tax of INR 71070 on his salary after availing deductions under Section 80 C , Section 80 D and Section 80 DDB of the income tax act.
Income tax slabs changed under the Union Budget 2014-15
Income tax slabs for the financial year 2014-15 for an Indian citizen between 60-80 years of age:
(A free guide on how to calculate your income tax under the changed tax structure)
Section 80 C exemption limits have been raised to INR 1.5 Lakhs in the Union Budget 2014-15
A maximum deduction under Section 80C, 80CCC and 80CCD combined has been revised to INR 1.5 Lakhs from INR 1 Lakh.
Mr Gaurav avails deductions under Section 80 C , Section 80 D and Section 80 DDB of the income tax act just as in the previous year
There are no changes in the salary Mr Gaurav earns in the financial year 2014-15.He continues to earn INR 9 Lakhs per annum.
Mr Gaurav continues to invest INR 1.5 Lakhs under the senior citizens saving scheme but this time gets a deduction of INR 1.5 Lakhs on the full amount he invests under Section 80 C of the income tax act.
The total income tax deductions claimed by Mr Gaurav under Section 80 D of the income tax act is INR 20000 just as before. There are no changes here.
Mr Gaurav has a dependent brother and he claims a deduction of INR 60000 for his treatment by virtue of being a senior citizen under Section 80 DDB of the income tax act. There are no changes here.
Mr Gaurav’s income tax liability is calculated as per the newly introduced income tax slabs in the Union budget 2014-15.
Mr Gaurav paid an income tax of INR 71070 in the financial year 2013-14 (Table 2).
Mr Gaurav now pays INR 55620 as income tax liability in the financial year 2014-15 (Table 4).
Mr Gaurav saves INR 15450 (Difference between INR 71070 - INR 55620) due to the change in the income tax laws in the new Union Budget 2014-15.
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IndianMoney.com Research Team
The research team at IndianMoney.com comprises of certified and experienced professionals who share the company's vision to make every Indian financially literate by equipping every Indian with right and unbiased advice. IndianMoney.com research team provides newsletters, articles, videos and FAQs on various financial products and concepts only to help you make wise financial decisions.