From 2020-21, salaried individual taxpayers and pensioners who don’t have business income can choose between two tax regimes – old and new, in which the income tax slab for senior citizens above 60 years is different. If taxpayers over the age of 60 are looking for new income tax slabs for FY 2025-26 (AY 2026-27), keep reading.

You would get the new budget pensioners tax slab here, along with several other related facts, including the senior and super senior citizen tax slab!

The law describes any resident individual above the age of 60 but below the age of 80, as on the last day of the previous financial year, as a senior citizen.

Any resident individual above the age of 80, as on the last day of the previous financial year, is termed a super senior citizen as per law.

The basic salary, fixed allowances, house rent allowance, and other sources of income form the basis for calculating a senior citizen’s income tax. The tax calculating procedure as per the income tax slab for senior citizens above 80 years is similar to that for individuals under 80 years.

However, it must be noted that a higher exemption limit under the old tax regime is applicable for senior and super senior citizens as compared to those aged lower than 60 years.

Income tax for pensioners or senior citizens is levied on every source of income. This includes pension, fixed deposits, post office schemes, rental income, interest or earnings from savings schemes, or reverse mortgages. During the tax calculation for senior citizens, gratuity and retirement benefits should be excluded.

For calculating a senior and super citizens income tax, the entire income is considered along with the senior citizen tax slab new regime for FY 2025-26 and allowable deductions. An income tax calculator can be a handy tool for determining taxable income. If you want to know your approximate tax liability, provide the following details:

• Assessment year for which a senior citizen/ super senior citizen is willing to calculate income tax
• Residential status, type of taxpayer
• Standard deductions
• Education cess @ 4%, according to the income tax slab applicable for senior citizens
• Surcharge (if applicable)
• Total tax liability
• Due date of submission of income tax return (ITR)
• Income from salary
• Income from house property (if applicable)
• Income and capital gains from other sources
• Gains or profit from any profession or business
• Agricultural income (if applicable)
• Completion of assessment for income tax return
• TCS or TDS (if applicable)

Under the new tax regime, income tax slabs for super senior citizens and senior citizens, taxpayers would have to forego most tax exemptions that were otherwise available under the old or existing income tax regime.

Under the new tax regime for senior citizens and super senior citizens for FY 2025-26, no increased basic limit of exemption exists for these two age categories. This implies that any individual, irrespective of age, would have ₹4 lakhs as the basic exemption limit for a given financial year. For FY 2024-25, this basic exemption limit was set at ₹3 lakhs.

Some common benefits for senior citizens for FY 2025-26, which might help ease their financial responsibilities, include:

• Under Section 80TTB, senior citizens don’t need to pay taxes if they earn interest of up to ₹1 lakh, effective from April 1, 2025, for a given financial year from savings bank accounts, bank deposits, post office deposits or cooperative banks.
• Senior citizens are exempted from paying advance tax for a given financial year if they do not have business income.
• They can also avail of the benefit of the Reverse Mortgage Scheme, under which, if they receive EMIs, they do not have to pay any capital gains tax on such monthly payments.
• Under Section 80DDB, they can claim a deduction of ₹1 lakh for medical expenses incurred for specified diseases.

In case senior citizens and super senior citizens opt for the new tax regime for FY 2025-26, they would have to forego certain income tax benefits, which are as follows:

• House Rent Allowance (HRA)
• Leave Travel Allowance (LTA)
• Other Special Allowances include - relocation allowance and helper allowance.
• Children Education Allowance
• Daily expenses in the course of employment
• Professional tax
• Interest on housing loan under Section 24
• Deduction under Chapter VI-A such as 80C, 80D, 80E, 80TTB, etc. However, deduction under the notified pension scheme and under 80JJAA is available.