In Budget 2025, Finance Minister Nirmala Sitharaman has doubled the tax exemption on FD for senior citizens, made NSS withdrawal tax free and gave relief in ITR rules. This will promote investment by the elderly.
Many reliefs have been given to the senior citizens of the country in Budget 2025. Finance Minister Nirmala Sitharaman not only gave gifts to the elderly like tax exemption and increasing benefits on savings schemes, but also simplified the rules for filing Income Tax Return (ITR) for senior citizens. The decisions taken in the budget will promote investment among the elderly and they will be able to invest in long-term plans with more confidence. According to the Finance Minister, these steps have been taken to reduce the financial burden of the elderly and encourage them to take independent financial decisions.
The government is well aware that most of the elderly people of the country invest in fixed deposits (FD) to keep their money safe. Keeping this in mind, the government has increased the scope of TDS exemption on interest received on FD. Also, important announcements have been made for National Savings Scheme (NSS) and National Pension Scheme (NPS) account holders.
Tax exemption on FD doubled
Till now, senior citizens were exempted from TDS on interest up to ₹ 50,000 received on FD. In Budget 2025, this exemption has been increased to ₹ 1 lakh. That is, now there will be no tax on interest up to Rs 1 lakh. This step will directly benefit those elderly people who invest their savings in FD.
Big relief in the rules for filing ITR
The rules for filing ITR for the elderly have also been changed. Earlier, senior citizens whose annual income was up to ₹ 5 lakh were not required to file income tax returns. Now this limit has been increased to ₹ 10 lakh. That is, now senior citizens with an annual income of up to ₹ 10 lakh will not need to file ITR.
Relief to NSS account holders
The government has also given relief to those elderly people who have old NSS accounts. Withdrawals made after 29 August 2024 from accounts in which interest has stopped coming have been made tax free. This will benefit lakhs of elderly people who were hesitant to withdraw money from their accounts for a long time.
Tax benefits on NPS Vatsalya accounts
In the budget, the government has also announced tax benefits for NPS Vatsalya accounts. Now these accounts will also get the same tax benefits that are given to normal NPS accounts. This benefit will also be within the overall limit.
