Section 80TTA of Income Tax Act Archives

A complete guide for Taxpayer on Difference between Section 80TTA and Section 80TTB of Income Tax Introduction Section 80TTA of the Income Tax Act is for HUFs, Individuals (but not Senior Citizens), and NRIs. However, Section 80TTB is only for seniors who are 60 years of age or older. This article includes information on Section 80TTA of the Income Tax Act, Section 80TTB under the Income Tax Act, and the Difference between Section 80TTB and Section 80TTA. Section 80TTA of the Income Tax Act Section 80TTA of the Income Tax Act, 1961 addresses the tax deductions for interest payments. Interest on savings accounts maintained by individuals (excluding senior citizen) or Hindu Undivided Families (HUF) is subject to this deduction. 10,000 rupees is the maximum deduction that can be made for all savings accounts. Eligibility Criteria of Section 80TTA The organizations listed below are eligible to deduct interest on all of their savings bank and post office accounts under Section 80TTA. HUF (Hindu Undivided Family) Individuals (excluding Senior Citizens) NRIs (Non-Resident Indians) Note: Only NRE and NRO accounts can be opened in India by NRIs. On NRE accounts, interest is not subject to tax and the 80TTA advantage is restricted to NRO savings accounts. Please be aware that NRO term deposits do not permit deductions. Section 80TTB under the Income Tax Act A taxpayer who is a resident senior citizen and is 60 years of age or older can avail benefits under Section 80TTB. At any point during a Financial Year (FY), a senior citizen may deduct a certain amount from his gross total income for that FY under Section 80TTB. Eligibility Criteria of Section 80TTB The following people are qualified for Section 80TTB deductions: Taxpayers who fall under the senior citizen category (people aged above 60 years) Individuals from India Seniors with savings, fixed-deposit, or recurring deposit accounts A person holding the aforementioned accounts at cooperative societies, banks, or post offices Difference between Section 80TTA and Section 80TTB Title Section 80TTA Section 80TTB Income Individuals can claim Section 80TTA if their annual income is under 2.5 lakh rupees. A PAN card holder who resides in India is required to meet both of these requirements. People who earn more than 2.5 lakh rupees annually are eligible to file claims under Section 80TTB. A PAN card holder who resides in India is required to meet both of these requirements. Maximum deduction Section 80TTA permits a deduction of 10,000 INR. From the gross total income, a deduction of INR 50,000 or a certain income is permitted, whichever is lower. Applicability Only income obtained in the form of interest from savings accounts is subject to Section 80TTA. In contrast, Section 80TTB applies to income from interest on all types of deposits. Eligible individual Residents and Non-residents can both avail benefits under Section 80TTA. On the other hand, only resident Indian can avail benefits under Section 80TTB. NRI provision Advantages under section 80TTA for interest on NRO savings accounts is available to senior citizen NRIs also. No such provisions are provided under Section 80TTB of the Income Tax Act. FAQs on Section 80TTA and Section 80TTB 1. How does Section 80TTB work? Section 80TTB is a provision that allows a taxpayer who is a resident senior citizen, aged 60 years or older, at anytime during a Fiscal Year (FY), to deduct a specified amount from his gross total income for that FY. 2. How many bank accounts may I deduct from my income under section 80TTA? Section 80TTA relates to the amount of interest, not the number of accounts you maintain. As a result, the tax benefit can be claimed for as many accounts interest as there are totaling up-to INR 10,000. 3. Do I have to declare the interest I received on the money I kept in my savings account? Yes, according to the Income Tax Act, any person for whom filing a return is applicable is required to disclose all of his income received during the reporting period and pay the related taxes.