I’m a senior citizen; I retired after working for multiple private companies. I don’t have any monthly pension payment directly from any ex-employer. However, I do have annuity income generated because of my past employment (see below). Kindly reply if the below income should be included under salary income (qualifying for standard deduction of ₹40,000 or other sources (by selecting ‘Any other’ and adding a description in ITR 1)
1. Annuity received from LIC P&GS (People and Group Scheme): Each of my former employers would deposit the superannuation allowance part of my monthly salary in LIC P&GS
2. Annuity received from LIC Jeevan Suraksha and HDFC Immediate Annuity: These are not employer/employment-related; these are self-contributed pension scheme annuities. I used to pay regular premium on my own (from my post-tax salary income)
3. Pension payout from PM Vaya Vandana Yojana
Srishyla MV
Salary is defined in the Income Tax Act to include annuity or pension. Annuity received from LIC P&GS on account of contributions made by your former employers under a scheme of superannuation is taxable under the head ‘Salaries’. As a result, you are entitled to claim standard deduction from this salary income.
You may note that pension received pursuant to premiums paid by you to LIC Jeevan Suraksha and HDFC Immediate Annuity plans is taxable as ‘Income from other sources’ (IFOS). Also, pension received under PM Vaya Vandana Yojna is also taxable under the head IFOS. Standard deduction is not available in respect of these annuity as the income is not in the nature of salary.
I purchased five 10-year zero-coupon bonds of NABARD (Bhavishya Nirman) for ₹42,500 in 2008-09. On maturity in 2018-19, I got ₹1 lakh. Thus the LTCG (long-term capital gains) without indexation is ₹57,500, for which the income tax rate is 10 per cent. But with the benefit of indexation, the LTCG is ₹13,139 and the rate of income tax is 20 per cent. I want to claim LTCG benefit with indexation. I am a 75-year-old government pensioner, and file ITR-2 as I own two houses. Please advise in which Schedule of ITR-2 and in which column and under which section I am to report this information.
LTCG earned from sale of zero-coupon bonds is required to be reported in Schedule CG – Capital Gains – Section B – 9 of ITR-2 for FY2018-2019. Also, sale consideration is required to be reported in the same form under 9(a)(ii) against ‘Full value of consideration in respect of assets other than unquoted shares’, and the indexed cost is required to be disclosed under 9(b)(i) against ‘Cost of acquisition with indexation’.
I deposit a monthly rent of ₹15,000 to the NRO account of my landlord who is an NRI. Please clarify whether TDS is required to be deducted while paying the monthly rent and whether Form 15 CA needs to be filed with the I-T Department? The NRI owner of the flat is not an income tax assessee in India. If TDS is required to be deducted, what is the implication/remedy if it was not deducted for earlier years.
KR Nataraj
Considering the provisions of Section 195 of the I-T Act, any person responsible for making rental payment to a non-resident Indian is required to withhold taxes at the rate of 31.2 per cent (30 per cent tax and 4 per cent health and education cess).
If the NRI has no tax returns-filing obligations in India, he/she could make an application before the tax authorities for lower/nil tax withholding.
Once the certificate is issued by the tax officer, you need not withhold taxes or deduct at such lower rate on your rental payments.
Form 15CA is required to be filed whenever any payment is made to an NRI. However, in your case, since the payment is happening in India, you may check with authorized dealers for the relevant formalities. Where TDS is required to be deducted for the earlier years and not done so, interest for non-deduction of tax and penalty could arise.
Kindly advise me whether the (tax) relief of up to ₹50,000 on account of interest on deposits (including interest on savings bank accounts and FDs) earned by a senior citizen is available in respect of AY2019-20 (for FY2018-19). I am a senior citizen. I filed ITR-1 on July 20, 2019, calculating taxes on the whole amount of interest earned on FDs as appearing in Form 26 as well as the bank interest certificate, without claiming any deduction in Part C of ITR-1. However, if this relief is available, kindly guide me on how to proceed in the matter and claim suitable refund if admissible.
Manajit Majumder
A resident senior citizen is eligible to claim deduction of up to ₹50,000 for interest on fixed deposits/interest on saving account u/s 80TTB effective FY2018-19.
You should file a revised tax return for FY2018-2019 on or before March 31, 2020. In the tax returns form, you could claim the deduction under section 80TTB and the consequential tax refund.
The writer is Partner, Deloitte India. Send your queries qo taxtalk@thehindu.co.in