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Chat Transcript

Balwant Jain

Tax and Investment Expert ,

All you wanted to know aboout Senior citizen scheme


Questions Answered


guest: Whether long term capital gains exemption is applicable for the transactions of sale of multiple houses or it is only applicable for sale of first home?

Balwant Jain: I understand you are talking about exemption available under Section 54 of the Income Tax Act. This exemption is available if long-term capital gains arising on sale of a residential house are invested for purchase/construction of another residential house within specified time. There are no restrictions as to the number of times you can avail this tax benefit as long as the long term capital gains on sale of one house are invested in another house. Moreover there is no restriction as to the number of houses, which you can own on the date of sale of the residential house property. In case capital gains arising on sale of a residential house are invested for purchase or construction of another residential house, you will get the benefit only in respect of capital gains invested in one house only. However, there is one once in a life time exemption available from long term capital gains from one residential house by investing the same buying two residential house provided the long term capital gains do not exceed two crores.

guest: I am an Andhra Pradesh state govt pensioner ,65 yrs age,male. I had made a deposit of Rs. 40000 in the senior citizen savings scheme to get the tax benefit under Section 80 C in March 2022. But the SUB TREASURY OFFER did not accept my documents to update this details in their online pension pay calculation system under tax savings particulars. Whether I can claim this deduction while E filing my ITR?

Balwant Jain: Generally, this is the practice followed by almost all the employers to ensure that the salaries of March month are disbursed well in time after deducting proper tax. Now you still claim this while filing your ITR to claim refund of excess taxes paid.

guest: I am 87 years old. My deposits in the Senior Citizen Scheme matured after years in June and the amount was credited in my savings bank account. I understand that the same can be extended for another three years. Can I avail these benefits as the money is still lying in my bank account?

Balwant Jain: No. You can not do it now as the extension can only be done before the proceeds are paid into your account. However you can place a fresh deposit for 5 years of up to 15 lakhs. The old deposit would anyway have been renewed at the current prevailing interest rate only.

guest: I am 65-year-old and have a profit of Rs. 50,000/- from intra day trading. I understand that this is treated as speculative business. I have not paid any advance tax during the last year. Whether I can show the profit of intra day trading as income from other sources and fill ITR1 or I have to use ITR3 and show this income as business income ?

Balwant Jain: No. You can not use ITR 1 but you will have to use ITR 3 as the intra day profit is speculative transaction and therefore has to be treated as business income only.

guest: Can I open an account under the senior citizen savings scheme multiple times after the maturity of original deposits?

Balwant Jain: Yes. You can open as many accounts under this scheme as you want and as many times as you want as long as aggregate of deposits in all accounts does not exceed 15 lakhs at any given point of time.

guest: If the property (for which I have taken a home loan) goes under some kind of legal dispute or the builder stops construction, what will happen to the loan? Will I need to keep paying EMI? How will property insurance help in such cases?

Balwant Jain: The loan agreement is between you and the lending bank and is independent of your agreement with the builder. In case of any legal dispute or stoppage of construction work by the builder, you still will have to keep on paying the EMI. Property insurance does not cover risks on matters pertaining to delay due to builder`s fault or legal dispute. Property insurance covers you against loss or damage to the property. You are liable to pay the home loan EMI`s to your bank to avoid being a defaulter. Basically it is the buyer (i.e. you) who is responsible for checking on the property title or the possibilities of a delay in construction and the risks to be borne.

guest: I am a pensioner. Tax was deducted by the post office from interest on the Senior Citizen Scheme of Post Offices during last year but I am not given the TDS certificates in spite of several reminders. What Can I do now?

Balwant Jain: You need not worry for the TDS certificate as the credit for the TDS is given by the income department on the basis of data available with them which are generated on the basis of TDS returns filed by the tax deductors. You can access the AIS and 26AS from the income tax web site. Check whether the tax deducted by the post office is reflecting in your AIS/26AS form. Alternatively you can access your Form No. 26AS from your bank’s internet login. In case the credit is not reflecting there, then you will have to chase the post office for the reason of no appearance of TDS in your account.

guest: I am 63-year-old. My income beside pension includes dividend, interest and rent and share trading profits. Do I have to pay advance tax?

Balwant Jain: Generally senior citizens do not have to pay any advance tax provided one does not have any professional or business income. The income may be positive or even may be negative. The activity of doing trading on stock exchanges or on commodity markets are treated as business activity so you have to advance tax even if you have incurred loss in trading activity.

guest: Under section 80TTB exemption limit is Rs.50000 for senior citizens. Kindly let me know whether the following items are covered under this deduction? Saving bank a/cs in bank as well as post office, interest on Senior citizen saving scheme a/c in post office, fixed deposits and recurring deposits with post office and banks and Post office Monthly income scheme?

Balwant Jain: The benefit of Section 80 TTB is available to a tax payer who has completed 60 years of age and who is a resident of India for the income tax purpose. The benefit is available for all the deposits with any bank, post office or cooperative bank. Yes, all the items mentioned by you qualify for deduction under Section 80 TTB.
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