What is the deduction under section 80TTA?
The Unique Section 80TTA provides a deduction of Rs 10,000/- on the interest income from Savings Bank Interest Max Rs. Ten Thousand. This deduction is out ... View MoreWhat is the deduction under section 80TTA?
The Unique Section 80TTA provides a deduction of Rs 10,000/- on the interest income from Savings Bank Interest Max Rs. Ten Thousand. This deduction is out there to a private and HUF.
This deduction is allowed on interest earned:
• From a savings bank account with a bank or Post Office
• From a bank/post office account with a co-operative society carrying on the business of banking
• From a bank account with a post office
This deduction isn't allowed on interest earned on time deposits:
The most valuable deduction under Section 80TTA shall not be allowed for the New Tax Regime and:
• Interest from fixed deposits
• Interest from recurring deposits
• Any other time deposits
Earlier, this deduction was available to everyone regardless of their age, i.e., to individuals aged below 60 years, senior citizens, and super senior citizens.
However, with effect from the fiscal year 2018-19, senior citizens cannot claim deduction under this section. Post Budget 2018, section 80TTA has been amended which restricts senior citizens from claiming any deductions on interest received on bank account either with bank or post office under this particular section. However, they will claim deduction up to Rs 50,000 for interest received from the bank account and glued deposit with banks and post office under the newly inserted section, i.e., section 80TTB.
What is Section 80TTB?
Section 80TTB which was applicable w.e.f 1 April 2018 may be a provision whereby a taxpayer who may be a resident oldster, aged 60 years and above at any time during a financial year claim a deduction of Maximum of Rs 50,000 or an amount from a specified income from his gross total income for that FY.
Specified income is any of the subsequent income in aggregate:
• Interest on bank deposits (savings or fixed);
• Interest on deposits held during a co-operative society engaged within the business of banking, including a co-operative land mortgage bank or a co-operative exploitation bank; or
• Interest on post office deposits
