The Central Board of Direct Taxes (CBDT) has notified a new rule that mandates senior citizens above 75 years to submit declaration in form 12BBA for claiming the benefit of not filing an income tax return (ITR) under section 194P.
A new Income Tax Rule 26D has been inserted after Rule 26C under Section 194P in the Income Tax Rules, 1962. The board has also amended form 16, form 24Q, form 26QC and form 26QD to incorporate necessary changes related to provisions of section 194P.
Accordingly, tax deduction at source (TDS) is deductible only for specified senior citizens above 75 years. These seniors need to submit a declaration of income in form 12BBA to the specified bank as notified by the Union government.
After receiving the declaration from the specified senior citizens, the specified bank will compute their total income after considering deductions available under section 80C to section 80U and rebate admissible under section 87A of the I-T Act. If needed, the bank will also deduct appropriate tax from the total income of these seniors.
Once the specified bank deducts tax under section 197P, the specified senior citizens are not required to file ITR since section 139 will not apply to them.