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TDS for Senior Citizen

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Accounts Manager
49 Points Joined November 2011

I am 62 years old and getting monthly pension @ 42,400/.  I retired from Government of India in April 2022 and joined as financial expert in Municipal Corporation at a consolidated salary @ ₹75,000/-.  Municipal Corporation is deducting my TDS under 194-J.  I am of the opinion that I am exempted from deduction of TDS under section 207 of the Income Tax Act.  Please reply, whether I am right or wrong?

Regards 

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On 11 March 2025 at 14:53 Report
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Master in Accounts & high court Advocate
9610 Points Joined December 2011

You're correct that Section 207 of the Income Tax Act provides exemption from TDS for certain individuals, but this exemption doesn't apply to your situation.¹

As a senior citizen receiving a pension, you're eligible for a higher exemption limit under the old tax regime. For FY 2023-24 and FY 2024-25, the exemption limit for senior citizens is ₹3,00,000, and for super senior citizens (above 80 years), it's ₹5,00,000.²

 However, the Municipal Corporation is deducting TDS under Section 194J, which applies to fees for professional or technical services. Since you're receiving a consolidated salary for your services as a financial expert, the TDS deduction under Section 194J is applicable.

To claim exemption from TDS, you would need to submit Form 15G or Form 15H to the Municipal Corporation, declaring that your income is below the taxable limit. However, considering your pension and salary, your total income might exceed the exemption limit.

 It's recommended that you consult a tax professional or financial advisor to review your specific situation and provide guidance on optimizing your tax obligations.

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On 11 March 2025 at 15:08

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