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Senior Citizen,Fixed Deposits and Tax

My father/mother is retired. He has a fixed deposit with a bank interest of Rs 50,000 a year. Does he need to file his income tax return? Is there any way he could be exempted from taxes?

We regularly get queries like above. Fixed Deposits are very popular among retirees and FDs feature in almost every senior citizens investment portfolio.  The advantages are:

  • It offers a high degree of safety to funds and
  • Fixed returns and  banks provide senior citizens with 0.25 % to 0.50 % extra interest rates
  • It also provides a good degree of liquidity as FDs can be broken at fairly low penalty rates.

But..the cons

  • Interest from Fixed Deposit is fully taxable.
  • TDS(Tax is deducted at Source) if interest from a FD exceeds 10,000 Rs. TDS is deducted at rate of 10%.

As interest from Fixed Deposit is taxable, this needs to be added to the Senior Citizen income. If total income for a senior citizen exceeds the exemption limit ( the income on which senior citizen does not have to pay tax) then senior citizen is required to pay tax. But if the income of the senior citizen is less than the exemption limit then senior citizen has two choices :

  1. Ask the bank not to cut TDS by submitting filled form 15H (pdf)  to bank every April.
  2. If TDS has been deducted ask for refund.

In this article we shall discuss  who is Senior Citizen and Very Senior Citizen, tax slabs for Senior Citizens, Fixed Deposits for Senior Citizens, Form 15H to avoid TDS, show interest in Income Tax Return and how to fill ITR  form for refund.

Who is Senior Citizen?

From Income tax perspective (as fro FY 2012-13)  there are two categories of Senior Citizens:

  • Senior Citizen : For age of 60-80 years
  • Very Senior Citizen : Above 80 years

Under the Income Tax Act, a senior citizen is a person who at any time during the previous year has attained the age of 60 years or more  i.e for a person who is  of age 60 but less than 80 years on end date of financial year (for 2012-13  is 31-Mar-2013) will be considered as senior citizen for that Financial Year. So

  •  A person who is of age between 60-80 years on 31st Mar 2013(including 31st Mar) will be considered as Senior Citizen for FY 2012-13 or Assessment Year 2013-14.
  • A person who is  above 80 years on 31st Mar 2013(including 31st Mar) will be considered as Senior Citizen for FY 2012-13 or Assessment Year 2013-14.

The age for Senior Citizen(and Very Senior Citizen) and the various tax slabs are announced in Budget every year.Before Financial year(FY) 2010-11 or Assessment Year 2011-12 the age limit for being considered a senior citizen was 65 Years. FY 2011-2012 also introduced Very Senior Citizen Category!(Ref LiveMint) Tax slabs for FY 2012-13(AY 2013-14) is as follows .( Our article Understanding Income Tax Slabs,Tax Slabs History discusses Tax slabs etc in detail)

TAX MEN and WOMEN SENIOR CITIZEN(Between 60 yrs to 80 yrs) For Very Senior Citizens(Above 80 years)
Basic Exemption 200000 250000 500000
10% tax 200001 to 500000 250001 to 500000
20% tax 500001 to 1000000 500001 to 1000000 500001 to 1000000
30% tax above 1000000 above 1000000 above 1000000
Surcharge  There is no surcharge in the case of every individual, Hindu undivided family, Association of persons and body of individuals
Education Cess  3% on Income-tax plus Surcharge.

So tax for Senior Citizen works out as follows: He/She does not have to pay tax if his/her income is less than 2.5 lakh (50,000 more than Men/Women below 60 years)

  • Pay 10.3% of tax on income between 2.5 lakh to 5 lakhs
  • Pay 20.6% of tax on income between 5 lakh to 10 lakhs Ex: for income of 7 lakh he will
  • Pay 30.9% of tax on income above 10 lakhs


  • For income of 3 lakh he will need to pay 10.3% of tax on income exceeding 2.5 lakh i.e 10.3% on 50,000 =5,150
  • For income of 8 lakh he will  need to pay 10.3% of tax on income of 2.5 lakh(10.3% on 2,50,000 =25,750) + 20.6% on income exceeding 5 lakh(20.6% of 3 lakh = 61800) i.e 87,550
  • For income of 12  lakh he will  need to pay 10.3% of tax on income of 2.5 lakh(10.3% on 2,50,000 =25,750) + 20.6% on income of 5 lakh(20.6% of 5 lakh = 1,03,000)  and 30.9% of income exceeding 10 lakh (30.9% of 2 lakh =61800 ) i.e 1,90,550

Age, Basic Exemption Limit, Slabs keep on changing with time. For example  For Financial year 2010-11 or Assessment Year 2011-12, age of senior citizens was 65 and income tax slabs were as follows.

Basic Exemption 160000 190000 240000
10% tax 160001 to 500000 190001 to 500000 240001 to 500000
20% tax 500001 to 800000 500001 to 800000 500001 to 800000
30% tax above 800000 above 800000 above 800000
Surcharge  There is no surcharge in the case of every individual, Hindu undivided family, Association of persons and body of individuals
Education Cess  3% on Income-tax plus Surcharge.

Earlier there was a big confusion on age of  senior citizen by different organizations . For example Union ministry of Social Justice and Empowerment defined a senior citizen as someone who is 60, but the income tax department allows benefits for the category only after 65 while an insurance company considered a person who is 55 as a senior citizen. Ref:When do you become a senior citizen?  MoneyControl Various Benefits a Senior Citizen Can Avail

Advantages to Senior Citizens

Other Facilities offered to Senior Citizens are:

  • Banks offer a higher rate of interest on fixed deposits to senior citizens. The offering is 0.5-0.75% more than the prevalent interest rates. The minimum age to get a premium on your deposit is 60.
  • A Senior Citizens Savings Scheme offering an interest rate is 9% per annum on the deposits made by the senior citizens in post offices has been introduced by the Government.
  • The Ministry of Railways provides 40% fare concession to men above 60 years and 50% concession to women above 58 years in all all classes, all  trains including Rajdhani, Shatabadi, Jan Shatabadi . The Indian Railways also have the facility of separate counters for senior citizens for purchase or cancellation of tickets. Concession Rules, list of categories  (pdf)
  • The Ministry of Road Transport and Highways mandates the reservation of two seats for senior citizens in front row of the buses of the State Road Transport Undertakings. Some state governments give fare concessions to senior citizens in the State Road Transport Undertaking buses and have introduced bus models that are convenient to the elderly.
  • Indian Airlines provides 50 per cent Senior Citizen Discount on Normal Economy Class fare for all domestic flights to Indian senior citizens who have completed the age of 63 years  ubject to certain conditions. Ref: AirIndia Webpage
  • JetLite offers Senior Citizens (65 years and above) concession on basic adult fare in Economy class, on all domestic sectors operated by JetKonnect. To avail of this concession, you have to fill the “Concession Form” and submit it along with a photograph and proof of age  More details at JetLite webpage Concessional Fares

Concessions and Facilities given to Senior Citizens  has information on benefits to Senior Citizens.

Senior Citizens and Advance Tax:In Union Budget 2012 it was proposed that senior citizens, who do not have any income from a business, would be exempted from payment of advance tax. Advance tax is applicable on all individuals, salaried or otherwise, with an advance tax liability of Rs 10,000 or more earned during a fiscal year. Normally, in case you owe advance tax(means you had to pay and you didn’t) you have to pay interest under section 23A/B/C.  Accordingly, now the senior citizen could pay tax after the FY ends on 31 March as “self assessment tax” on taxable income before filing returns. (Ref: Livemint For senior citizens no advance tax if no business income)

Interest on Fixed Deposits for Senior Citizens

Banks offer a higher rate of interest on fixed deposits to senior citizens. The offering is 0.25-0.75% more than the prevalent interest rates. The minimum age to get a premium on your deposit is 60. A younger age group person can also enjoy this benefit if he opens a joint account with a senior citizen. But the deposit needs to be in the name of the elder one. How much extra will senior citizen earn, let’s see through an example Using our Fixed Deposit Calculator (In India Interest rate on Fixed Deposit is compounded quarterly)

  • Senior citizen investing Rs 50,000 for a 3-year-tenure at 9.5% will get 66,266.95 on maturity
  • A person invests Rs 50,000 for a 3-year-tenure at an interest rate of 9% get  Rs 65,302.5 on maturity

Senior citizen will get Rs 965(964.45) more. If a senior citizen opts for quarterly payout of interest, then he earns Rs 750 more. Interest rates on fixed deposits changes from time to time. For example last year interest rates offered on term deposits were higher. At any particular time interest rate depends on

  • Period or tenure of deposit ( 15 days, 1 year , 5 years etc),
  • Interest paid every quarter or on maturity(cumulative)
  • Amount invested (less than 15 lakh, more than a crore etc)
  • Bank. Interest rate varies from bank to bank.

While many websites cover interest rates on fixed deposits ,but  check if the information is updated. We found that Moneycontrol’s Best Rates by Fixed Income Instruments allows one to search on different parameters (Tenure, Investor Type) quite updated. To find rates for Senior Citizen choose Investor Type as Senior Citizen. In any case  you are requested to reconfirm the rates from the respective institutions before making any financial commitments. (Click on image to enlarge)

FD interest rates search on moneycontrol

FD interest rates search on moneycontrol

TDS on Fixed Deposit

Tax or TDS is deducted by the bank, if the aggregate interest income from fixed deposits that you are likely to earn for all your deposits held in a branch is greater than Rs 10,000 in a financial year. If  Bank deducts TDS then bank would give you FORM 16A and it would also come up in FORM 26AS. Please verify. (Avoid TDS : Form 15G or Form 15H covers the topic in detail)

TDS can be avoided by:

  • Distributing FD investment:Split the FD to separate banks or branches of banks in such a way that interest earned from any of the FD does not exceed the Rs 10000 limits.
  • Timing the FD: The TDS can also be saved by timing the FD in such a way that interest for any of the financial years does not exceed Rs 10000. For example, a 12-month FD of Rs 1 Lac @ 10.5% could be started in September as the financial year closes on 31st March so the interest would split in two financial years, and hence TDS could be avoided.
  • By Submitting Form 15G/15H. For Senior Citizens Form 15H 


  • Whether TDS is deducted or not interest in Fixed Deposit is taxable ,
  • Tax  on FD is calculated by adding interest income from FD as income from other sources to your salary etc and then tax is calculated as per your income slab

Form 15H to avoid TDS for Senior Citizen

Form 15H is a declaration made by senior citizen for Bank to not deduct tax  when 🙁 Under sub-section (1C) of section 197A of the Income-tax Act, 1961,)

  • He is a senior citizen
  • His estimated income in the year will be below the exemption limit.
  • Has submitted PAN
  • Form 15H is valid only for a year. It has to be submitted every year in the month of April for every fixed deposit whether interest is paid or not (in case of cumulative)

If senior citizen does not fill form 15H, does not fill on time or due to bank officials somehow Form 15H is not considered, TDS will be deducted when interest for all one’s deposits held in a branch is greater than Rs 10,000 in a financial year.  Note: interest on FD in that Financial year should be more than 10,000, it’s not the amount invested in FD or total interest earned in FD. Part of 15H (pdf) is shown in picture below.

Form 15H: No TDS for Senior-Citizen

Form 15H: No TDS for Senior-Citizen

 PAN is necessaryIf PAN is not submitted then TDS will be at higher rate and Form 15H will be invalid.

  • As per section 206AA introduced by Finance (No. 2) Act, 2009 wef 01.04.2010, every person who receives income on which TDS is deductible shall furnish his PAN, failing which TDS shall be deducted at the rate of 20%(as against 10% which is existing TDS rate) in case of Domestic deposits and 30.90% in case of NRO deposits
  •  In the absence of PAN  TDS certificate will not be issued, form 15G/H and other exemption certificates will be invalid even if submitted and penal TDS will be applicable  (as per CBDT circular no:03/11)

TDS and Income Tax Return If you file Income Tax Return then you need to show interest earned from Fixed Deposits and TDS.

  • Interest from Fixed Deposit comes under Income from other sources. 
  • TDS cut is shown in DETAILS OF TAX DEDUCTED AT SOURCE FROM INCOME OTHER THAN SALARY. (Note: This is as per Form 16A and is reflected in Form 26AS)

Sample images from  Filling ITR-1 : Bank Details, Exempt Income, TDS Details are shown below for Mr. Mehta who had income Interest on saving bank account (Rs 5000) and Interest from Fixed Deposit(Rs 20,000) and bank deducted 10% TDS i.e 2,000 Rs on FD. (Note: These images are for ITR1 of FY 2011-12(AY 2012-13. Forms for FY2012-13(AY 2013-14) may be different).

ITR1: Part B
TDS is shown in part of ITR with deals with details of Tax Deducted at Source Other than Salary. Note: This is as per Form 16A and is reflected in Form 26AS.
ITR1 : Sch TDS2

Refund on  TDS

If TDS has been deducted for interest on FD and senior citizen(or any individual for that matter) is not liable to pay tax then one can claim refund on tax. Income Tax Return Form have a portion called as  Tax category. Where one needs to Fill Tax Refundable in Nature  of Tax in ITR. The category is based on total tax payable with and interest and total prepaid tax.

A19 Tax category
Tax category works as follows:
  • If total tax and interest < total prepaid tax then fill tax refundable
  • If total tax payable > total prepaid tax then fill tax payable
  • If total tax payable = total prepaid tax then fill nil tax balance

It has to be supported by showing the tax computation and tax deducted.  Which are in Part TAX COMPUTATION AND TAX STATUS of the ITR Form. For ITR 1 of FY 2011-12(AY 2012-13) parts of ITR1 is shown below.

How to choose Nature of Tax

Ref: Livemint answer on tax oninvestments for Senior Citizen (Nov 2012)

Related Articles:

In this article we discussed who is Senior Citizen and Very Senior Citizen, tax slabs for Senior Citizens, Fixed Deposits for Senior Citizens, Form 15H to avoid TDS, show interest in Income Tax Return and how to fill ITR  form for refund.

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46 Responses to Senior Citizen,Fixed Deposits and Tax

  1. K Santhi says:

    My Mother-in-Law is 82 years old. She wants to sell her property and deposit 4 lakhs as FD. she does not have PAN card. Is Tax deducted for the interested earned.

    • bemoneyaware says:

      She can fill Form 15H no TDS will be deducted.
      If her income is interest from FD + other income is less than 5 lakh as she super senior citizen she does not need to file ITR.

  2. Neha says:

    hello, I am 27year old and want to do FD for my father who is 55 years and woking as business man. If I will do a FD on name of my father for rupees one lakh say then who have to pay tax for same. kindly suggest.

  3. ER ROHITASHV says:


    • bemoneyaware says:

      LIC Policy 122-12 is Jeevan Suraksha policy. LIC Jeevan Suraksha is a deferred annuity/pension plan, which allows policyholder to make provision for regular income after the selected term or after the age of retirement.
      The lumpsum of 25 per cent is taxable in the year of receipt.
      the pension/annuity received is fully taxable in the hands of the individual or the legal heirs
      Pension received from LIC comes under Income from Other Sources.

  4. Ashish kumar says:

    Hello sir
    My father is a senior citizen who retired in 2012.he has monthly income scheme and fixed deposit in one bank.the total income of interest is almost 200000.his pension come in other bank which is per 2015 16 financial year senior citizen exempted from income tax if it is up to 300000.if I add both pension+interest the income goes up to 320000.since 2012 he has filed 15h form to avoid I want to know whether he I liable to pay tax.

  5. Umesh says:

    My father is above 60 year and he has two Fd. Can he fill single form 15H for both Fd?


    I am 60 years old and retired from Central Govt. service in November 2015.My yearly pension plus interest from FDs exceed Rs. 5 Lakh , and I come under the 20.6% tax bracket. How to pay self assessment tax for my income . In which months I have to deposit this tax By IT Challans in Nationalised Banks.

    • bemoneyaware says:

      Sir Senior citizen don’t have to pay advance tax. So if you some tax to pay please pay it before filing your ITR, You can pay in any bank using physical challan or online. Our article Challan 280: Payment of Income Tax discusses it in detail.


      I am 63 years old and retired from Central Govt. service in November 2015.My yearly pension plus interest from FDs exceed Rs. 6 Lakh , and I come under the 20.6% tax bracket. How to pay self assessment tax for my income . In which months I have to deposit this tax By IT Challans in Nationalised Banks.


      I am 60 years old and retired from Central Govt. service in November 2015.My yearly pension plus interest from FDs exceed Rs. 5 Lakh , and I come under the 20.6% tax bracket. How to pay self assessment tax for my income . In which months I have to deposit this tax By IT Challans in Nationalised Banks. Interest accrued amount on senior citizen deposits scheme in Post offices & nationalised Banks is exceed Rs 10000/- Whether Interest amount is Taxable

  7. JHRao says:

    My wife has FDs and a PAN holder.She became senior citizen on Jan 7,2016 before the maturity of FDs.If she breaks the deposits and renew for the same period, will she gets the interest 0.5% more and interest before breaking with out penalty.

  8. P.Thamilmani says:

    My mother is a widow,aged 82, whose is living on my small financial support
    and living separately in a small house. By her small savings she deposited
    Rs.50000/- and Rs.25000/- fixedly for 3 years. On maturity, the bank
    deducted Rs. 2763/- and Rs.1354/- towards IT from the Senior citizen who
    has no income and had no PAN also. How she is able to get the Income Tex
    deducted by the bank unnecessarily from the non taxable citizen.

    • bemoneyaware says:

      You are right but Banks are also tied up with rules.
      Banks are required to deduct TDS at 10% , if the total interest earned on your fixed deposits in a bank branch exceeds Rs 10,000 in a financial year.
      Make sure than your PAN is updated with the Bank otherwise TDS will be deducted @ 20%
      Please apply for PAN and file her ITR and claim the TDS deducted.

  9. m.balaram says:

    i am a retired employee. the amount received on retirement is deposited in 2 bank a/cs and is giving me int. monthly for my wife and myself which is meagre for our livelyhood. I would like to know how much can I besafe without tax. thanking you

    • bemoneyaware says:

      Sir we can understand your situation, many senior citizens are in the same position.
      Interest on Fixed Deposits is taxed as per the income slab.
      If only income you have is interest from FD and interest from all the FD is less than 3 lakh – the interest not the FD amount then you don’t have to pay any tax.
      3 lakh is basic exemption limit for senior citizen i.e above 60 years of age.

  10. sayyed aftab says:

    sir my father 67 after selling property want to deposit (FD)3000000/- in bank now he don’t have any income then what will be the tax on FD it is on the income interest or on all deposited amount that that means if bank giving 9%annum on 3000000 that is 270000 then he have to pay intrest on 270000 or 3270000?and how much

    • bemoneyaware says:

      Interest on FD is taxable so 2,70,000 is taxable as per the income slab.
      As your father is above 60 years the exemption limit is 3 lakh. So if only income is interest from FD its Tax free!

  11. RAVI SHANKAR says:

    Hello sir, my father retired from a government job this year on January 2015 and was paid around 15 lakh for whom tax has already been deducted by company. My father fixed the money as FD and MIS in bank for earning on interest and submitted form 15H. But when I checked Form 26AS of my father for this year, 20k money is showing in it under 15H column in the assessment year 15-16 for money accrued during February and march 2015, for which TDS has not been deducted. ( In March beginning my father got 6k as interest and other 15k has been shown by bank by dividing the total interest on FD monthwise and shown it as earning in current year which my father didn’t get ).

    So my question is whether 20k money which is showing under 26AS is taxable as extra income or non taxable.

    • bemoneyaware says:

      Sir Interest on FD and MIS is taxable as per the income slab. As your father had submitted 15H form , bank honoured the wishes and informed the Income tax department that it has not deducted the interest.
      The interest will be paid only when the FD matures and one can choose whether one should show interest yearly or maturity. It is recommended that one use the yearly method of reporting interest especially if the entry would be in Form 26AS i.e for interest above 10,000.
      On the retirement money that your father received you have to see how much is taxable ex gratuity, leave encashment and then arrive at the income from salary and exempt income.

      • RAVI SHANKAR says:

        But its just two months after retirement Feb and march 2015, which came under last financial year. So do you suggest whether that 15K which my father has not got, but is shown on 26 AS – Should father give tax on that 15K or not.

  12. saurabh says:

    My father’s age is 65 means he will be coming under senior citizen slab. He is getting pension + interest on fd( income from other source). Qus is when sumitting ITR how/where to get relaxed hra/medical amount or it is not applicable for senior citizen.

  13. Chaitanya Hegde says:

    My parents are senior citizen and they are depending on me, and they are not in tax payers band. My question is that if i gifted money (say l lakhs) to my parents and they deposited the money in their names in bank, then is it possible to show gifted 1 lakhs in 80C section(My 80C limit is not crossed) for me to show as an investment?

  14. Sir,
    My wife and I both are Sr.Citizen over 70 yrs.i am pension depending on my 2 sons financial wife a post surgical patient, me and my wife spend over 10K on medicines/Diagonistic /month. My only asset my flat I intend to sell out could fetch 1.5 cr. in present market price( was bought 20 yrs. back for 7 lacs. only)I would klike to keep this entire money in FD and live till we survive on the interest of te same. kindly let me know the ideal tax plan to save for the best monthly retun for Med.Expense and our daily requirements. The FD will be equally shared by our 2 sons after our demise as per my Will. Thanking you, with best regards, S.K.Bose.

  15. Manu says:

    I have opened an FD in the name of my father from my account . Will I be tax liable for it?
    If the FD auto renews itself the next year , then who will be tax liable?

    • bemoneyaware says:

      No as you are adult you can say you have gifted the money to your father.
      FD is in your father’s name, PAN number would be of father.
      Your father can avoid TDS if he submits form 15G/form 15H to bank

  16. Pawan Mundra says:

    Dear Sir,
    If any senior citizen give a loan to a Proprietorship firm and charged a interest of Rs. 30000/- in a f.y. so please advise me TDS deducted by the firm or he submit Exepmtion Form.

  17. sapna says:

    My mom is a senior citizen and she has some FDs in her bank account, around 4 lacs. There is no other income but she is living with my sister who has a job. Would any TDS be deducted from her FD interest. What is the threshold at which she has to pay TDS? Also would my sister’s income affect her TDS since they live in the same household. I am not in India and I have no clue about India’s tax laws. Just wanted to help my mother to make good financial decision. Thanks a lot for providing help on this matter. Your website is very much organized and has good information.

    • Kirti says:

      Thanks Sapna. Good you have started to take interest in your mother’s financial affair.
      Coming to your questions
      1. TDS is deducted if interest from FD ia a bank branch is more than 10,000 in financial year which is 1 Apr – 31 Mar of next year. Rate of deduction is 10% with PAN submission and 20% without PAN.
      2. Interest on Fixed Deposit is calculated based using quarterly compounding(if she is not taking monthly/quaerterly interest) and depends on amount, time period and interest rate.
      Assuming that she has invested 4 lakh for 1 year at 9% , using our FD calculator
      the interest amount turns out to be 37233.33 which is more than 10,000 so bank will deduct TDS.
      3. Person who is the first holder of FD has to pay interest on Income from interest on FD. So has she opened FD in her name with your sister as second holder or your sister as nominee.
      If your sister is second holder then your sister will not have to pay tax on interest income. If your sister is the first holder then that’s a different matter.
      4. If only income your mother has is interest from FD or if her income is less than the exemption limit for paying tax then two scenarios come :
      a. For the TDS which has been deducted for last year she need to file Income Tax Return (ITR) and claim Refund.
      b. For the current financial year she should submit Form to the bank to ask them not to deduct TDS. Form is 15H or 15G depending on whether she is senior citizen or not.

      Is your mother a senior citizen i.e is she above 60 years? There is another category called Very Senior Citizen for those above 80 years.
      Sadly we are not taught about tax laws in colleges so it’s okay if you don’t know. (I am still learning and I have been working since last 15 years :-))
      Please ask any point which is not clear to you. Our purpose of starting the blog is to help increase the awareness to money related matters.

  18. Gagan says:

    Just to confirm what has been said in this article…I have a joint account with my mother who is a Senior citizen. The first name in the account is mine. She has opened a FD for Rs 1,00,000 in the account in her name and has submitted form 15 H. Would the interest generated from the FD be taxable if my mothers income for the year is less than 2.5 lakhs. Would I be liable to pay tax om the interest form this FD. ?

    • Kirti says:

      I am confused who has first name in your FD?
      If it’s you – you will have to pay tax on interest if it’s your mother – she has to pay .
      If she has opened FD in her name and has submitted for 15H TDS will not be deducted on her interest earned. If her income is less than 2.5 lakh.
      You cannot pay for tax on income of some other. Whether your mother has earned it herself or you gifted her.

      • Gagan says:

        Thanks for the reply Kirti..The FD is in my mothers name and her income is less than 2.5 and has submitted 15 H. Then as per your reply no TDS will be deducted and she won’t have to pay income on the interest on the FD…

        • Kirti says:

          Yes Gagan your mother, a senior citizen (between 60 years-80 years) will

          not have to pay income tax on interest earned in FD if her income is less than 2.5 lakh

          If she has submitted form 15H and has PAN card bank should not deduct TDS . Is she doesn’t have PAN card then bank would deduct TDS at 20%

          She needs to fill form 15H every year and hope that bank does not goof up.

  19. i.raja mohammed says:

    sir my clients invested above 30 lakhs, he is senior citizen, this year intrest income above
    RS.250000/- he is submmited form 15h but the company say form 15h not applicable


    • Kirti says:

      We have a question regarding “he is submmited form 15h but the company s” is it a bank or a company fixed deposit?
      As senior citizen interest income only is more than 2.5 lakh taxable limit for FY 2012-13 bank will deduct the 10% TDS. That’s the rules. You can read about the rules
      at IDBI webpage also

  20. Aparna says:


    My father is 61 & mother is 59. They both used to have PPF accounts (both being non-salaried). Upon maturity they withdrew the money and put it in an FD.

    (10 lacs each)

    I would like to know if there is a better way to invest this money for them to get good returns minimizing their taxes since they will both stop earning income in next 4-5 years.

    Are there any pension plans / fixed income gurantee plans with minimal risk that exist?

  21. sanyam jain says:

    very well written…U have covered all the important aspects of this scheme…thnx for sharing your knowledge with us…


  22. Nice info.Might help lot of senior citizens. Thanks and Keep Sharing.

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