Clarification to pensioners about the hike in exemption limit to Rs 3 Lakhs from Minister of State for Finance.
Shiva Pratap Shukla
D.O. No. 370150/9/2017- TPL
MINISTER OF STATE FOR FINANCE
GOVERNMENT OF INDIA
14th November 2017
Dear Dr.Tharoor Ji,
Kindly refer to your D.O. letter No. DO/S1/09/2017/986 dated 26.09.2017 requesting, for providing the exemption of Rs. 5 lakhs per annum to pension income.
I have got the matter examined. Currently, the basic exemption limit for individual taxpayer is Rs, 2, 50,000, However, considering the specific needs of the senior citizens, the basic exemption limit for a senior citizen above 60 year, is fixed at Rs.3,00,000 and for very senior citizen i.e. above 80 years, the same is fixed Rs. 5,00,000. Therefore, a pensioner who is a senior citizen is not required to pay any income-tax if his. total income, including pension., does not exceed Rs. 3 lakhs Similarly, a pensioner who is very senior citizen is not required to pay tax if his total income, including pension, does not exceed Rs. 5, 00.000. However, the suggestions that pension up to Rs. 5 lakhs per annum should be exempt in all cages would require amendment to the existing provisions of the Income-tax Act, 1964.
Accordingly, the proposal would be examined during the exercise for the ensuing Union Budget, 2018 and the outcome would be reflected in the Finance Bill 2018.
(Shiv Pratap Shukla)