Here are a few salient features pertaining to senior citizens:
New tax slab
A new tax slab for senior citizens of 80 years (very senior citizens) and above has been introduced. Very senior citizens will be eligible for a higher exemption limit of Rs 5 lakhs. They are now entitled to an additional maximum tax savings of Rs 26,780.
Higher tax exemption
The general category has little reason to complain as tax exemption limit is raised to Rs 1.8 lakhs from Rs 1.6 lakhs. Exemption for senior citizens is raised to Rs 2.5 lakhs. This is a welcome move for senior citizens trying to meet the expenses of everyday life and coping up with increased medical expenses, with little cash inflows.
The age qualification for senior citizen has been revised downwards from 65 years to 60 years. Taxpayers in the age bracket of 60 to 65 years will benefit from the move to lower age limit qualification of senior citizens.
NPS more attractive
With a budget allocation of Rs 1 billion, the government will contribute Rs 1,000 to those who join the scheme in the next fiscal. The tax treatment to the National Pension Scheme (NPS) has been slightly altered. The employer's contribution to the account will not be eligible for inclusion under the Rs 1 lakh limit under Section 80C. This opens up opportunity for individuals to save more money. The employer's contribution to NPS can be classified as business expense.
Soaring day-to-day living expenses and increasing healthcare costs have put the senior citizens on a tight rope walk. Very senior citizens have reason to cheer in the Budget. People at 60 can claim senior citizen benefits now. But with no government-backed pension schemes and unemployment benefits like in the West, a broad gap still needs to be narrowed. Affordable healthcare is one of the prime needs of people in their later years