I am a senior citizen and draw pension through a bank. Although I am allowed to deposit self-assesment at the time of filing IT return in assessment year 2013-14, the bank is deducting income tax every month. What is the rule?
D. Dutta Gupta, Calcutta
A senior citizen drawing pension through a bank and having interest income from a bank deposit is required to compute the tax liability on his total income exceeding Rs 2.5 lakh. If the tax liability so computed exceeds the total tax deducted at source by the bank on interest income, you are required to deposit self assessment tax on the excess tax. Conversely, if the tax liability does not exceed the tax deducted at source by the bank, you are required to claim the refund by filling return of income.
I purchased a flat for Rs 6 lakh in 1999. I want to sell it now for Rs 16 lakh. I am a senior citizen with an annual income of Rs 1.92 lakh. What will be my tax liability?
Mridul Kanti Dhar, Calcutta
The cost inflation index in 1999-2000 was 389 and that for 2012-13 is 852. So, the indexed cost of acquisition is Rs 13,14,139 (Rs 6 lakh x 852/389). The capital gain is Rs 2,85,861 (Rs 16,00,000-Rs 13,14,139). So, your aggregate annual taxable income is Rs 4,77,861 (Rs 1,92,000 + Rs 2,85,861). As a senior citizen, your basic exemption limit is Rs 2,50,000. So, under Section 112 of the Income Tax Act, you are required to pay a capital gains tax on Rs 2,27,861 (Rs 4,77,861 - Rs 2,50,000) at the rate of 20.6 per cent.
I am a senior citizen with an income of Rs 1,66,737 after deduction under Section 80C (i, ii, iii) and 80D. Can I stop filing tax returns?
Raja Sen, Calcutta
If your gross total income without claiming deduction under Section 80C to Section 80U exceeds the basic exemption limit of Rs 2,50,000, it will be mandatory for you to file the income tax return under Section 139(1) of Income Tax Act, 1961.
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