Centre Raises Tax Exemption Limit For Senior Citizens

Senior citizens who have made deposits under the Senior Citizens Savings Scheme will not be under tax deduction at source (TDS) on interest earnings up to Rs 10,000 in a financial year. This is because the Government has hiked the threshold limit for exemption on TDS on the interest paid under this scheme to Rs 10,000, from the current level of Rs 5,000 in a financial year. The Senior Citizens Savings scheme was launched in 2004 and offered 9 per cent interest to depositors aged 60 years and above. A depositor can invest a maximum of Rs 15 lakh in the scheme, which has a lock-in period of five years. Apart from the Senior Citizen Scheme, the Finance Ministry has also now hiked the threshold limit for TDS exemption for interest (other than interest on securities) paid by banking companies and cooperative societies engaged in the banking business. The threshold limit has been pegged at Rs 10,000 as against the earlier specified amount of Rs 5,000 in a financial year