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NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Tax Provisions for Special Cases

Kiran, a resident individual, has opted for the old regime and is eligible for the section 80TTB deduction as a senior citizen. Her interest income for the year is: savings account Rs 22,000, bank fixed deposit Rs 38,000, post office deposit Rs 15,000. Assuming the deduction limit for senior citizens is Rs 50,000 on eligible deposit interest, what deduction is allowed?

The deduction is Rs 50,000. Total eligible interest is Rs 75,000, but section 80TTB caps the deduction for senior citizens at Rs 50,000. The Rs 10,000 limit under 80TTA does not apply to senior citizens.

  1. ARs 10,000
  2. BRs 50,000Correct
  3. CRs 75,000
  4. DRs 38,000

Explanation

Section 80TTB covers interest from savings accounts, fixed deposits and post office deposits for senior citizens. Total eligible interest is 22,000 + 38,000 + 15,000 = Rs 75,000. The deduction is capped at Rs 50,000, so Rs 50,000 is allowed. The Rs 10,000 limit is for section 80TTA and does not apply to senior citizens.

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