Published 21 October 2026
A person who turns sixty is told that the tax law now treats them differently: a higher exemption limit, a larger deduction for interest, more for health insurance, and no advance tax. Most of that is true, but only under the old tax regime. The new regime, which applies unless the person opts out, gives no age-based exemption at all. Most of the senior citizen deductions are also unavailable under it. And from 1 April 2026 every one of these provisions has a new section number under the Income-tax Act, 2025. This guide sets out what changes at sixty and at eighty, under which regime, and under which Act.
Which Act governs which year
- Financial year 2025-26 (assessment year 2026-27) and earlier. The Income-tax Act, 1961 applies. Returns for AY 2026-27 are filed under it, and the rates come from section 2 and Part I-A of the First Schedule to the Finance Act, 2026.
- Tax year 2026-27 onwards. The Income-tax Act, 2025 applies from 1 April 2026, with the Income-tax Rules, 2026. The rates for tax year 2026-27 come from section 3 and Part I-B of the First Schedule to the Finance Act, 2026.
- Proceedings for earlier years continue under the 1961 Act by section 536 of the 2025 Act.
Who is a senior citizen
Both Acts use the same test. The 1961 Act defines a senior citizen in each provision that uses the term, for example the Explanation to section 80TTB: “an individual resident in India who is of the age of sixty years or more at any time during the relevant previous year”. Section 2(100) of the 2025 Act has the same definition, with “tax year” in place of “previous year”.
Three points follow from those words:
- Residence is a condition. A non-resident aged seventy is not a senior citizen for any of these provisions.
- Age is tested “at any time during” the year. A person who turns sixty on 31 March 2026 is a senior citizen for the whole of FY 2025-26.
- There is no general definition of a “super senior citizen”. The rate schedules simply have a separate slab for a resident “of the age of eighty years or more at any time during” the year.
The exemption limits under the old regime
For AY 2026-27, Part I-A, Paragraph A of the First Schedule to the Finance Act, 2026 sets three scales for individuals:
| Individual | Nil up to | Then |
|---|---|---|
| Below 60, or non-resident | Rs 2,50,000 | 5 per cent to Rs 5,00,000; 20 per cent to Rs 10,00,000; 30 per cent above |
| Resident, 60 or more but below 80 | Rs 3,00,000 | 5 per cent to Rs 5,00,000; 20 per cent to Rs 10,00,000; 30 per cent above |
| Resident, 80 or more | Rs 5,00,000 | 20 per cent to Rs 10,00,000; 30 per cent above |
Part I-B, Paragraph A of the same Schedule repeats the identical scales for tax year 2026-27 under the 2025 Act. Section 3(2)(a) of the Finance Act, 2026 lists the same Rs 3,00,000 and Rs 5,00,000 as the “maximum amount not chargeable to income-tax” for these two groups. Health and Education Cess at four per cent is added to the tax and surcharge in both years.
The rebate is not age-based. Section 87A of the 1961 Act gives a resident individual whose total income does not exceed Rs 5,00,000 a rebate of the tax or Rs 12,500, whichever is less. Section 156(1) of the 2025 Act is the same. A resident aged 60 to 79 with total income of Rs 5,00,000 under the old regime therefore pays no tax, as does anyone else with that income.
The new regime has no age-based limit
Section 115BAC(1A) of the 1961 Act, clause (iii), inserted by the Finance Act, 2025 for AY 2026-27 onwards, has one table for all individuals: nil up to Rs 4,00,000, then 5, 10, 15, 20 and 25 per cent in Rs 4,00,000 bands, and 30 per cent above Rs 24,00,000. Section 202(1) of the 2025 Act carries the same table for tax years from 2026-27. Neither provision distinguishes by age. The Finance Act, 2026 table gives a single “maximum amount not chargeable” of Rs 4,00,000 for anyone taxed under section 115BAC(1A) or section 202.
The rebate under the new regime is larger. Under the first proviso to section 87A, as amended by the Finance Act, 2025 from 1 April 2026, it is up to Rs 60,000 where total income does not exceed Rs 12,00,000, with marginal relief just above that. Section 156(2) of the 2025 Act is the same.
The new regime is the default. An individual without business income opts out of it under section 115BAC(6) “along with the return of income to be furnished under sub-section (1) of section 139”. Under section 202(4)(b) of the 2025 Act, the option is exercised “along with the return of income to be furnished under section 263(1)”. The choice can therefore be made afresh each year in the return. The comparison is set out in Old or New Regime: The Choice for Employees.
The deductions that turn on age
| Deduction | 1961 Act | 2025 Act | Senior citizen limit | New regime? |
|---|---|---|---|---|
| Interest on deposits | s.80TTB | s.153(1)(b), (2)(b) | Rs 50,000 | No |
| Health insurance and medical expenditure | s.80D | s.126 | Rs 50,000 | No |
| Treatment of specified diseases | s.80DDB | s.128 | Rs 1,00,000 | No |
Interest on deposits: Rs 50,000
Section 80TTB(1) allows a senior citizen a deduction of interest on deposits with a bank, a co-operative bank or a post office: the whole amount if it is no more than Rs 50,000, and Rs 50,000 in any other case. Unlike section 80TTA, which covers only savings accounts and is capped at Rs 10,000, it covers fixed and recurring deposits as well. A senior citizen cannot claim section 80TTA, which excludes “the assessee referred to in section 80TTB”.
Section 153 of the 2025 Act merges the two. Section 153(2)(b) gives an individual who is a senior citizen “the whole of the interest up to a maximum amount of Rs 50000 on deposits in any account, including time deposits”. Interest on deposits held by a firm, AOP or BOI does not qualify under either Act. Interest on bonds, debentures or company deposits is not “interest on deposits with” a bank, co-operative bank or post office, so neither provision covers it.
Health insurance and medical expenditure: Rs 50,000
Under section 80D(4), the Rs 25,000 limits for health insurance premium become Rs 50,000 where the insured person is a senior citizen. This applies separately to the assessee’s own group (self, spouse and dependent children) and to parents. A senior citizen paying for a senior citizen spouse thus has up to Rs 50,000. Paying also for a senior citizen parent adds up to a further Rs 50,000. Preventive health check-up is included within these limits, up to Rs 5,000, and is the only item that may be paid in cash (section 80D(2B)).
Where a senior citizen has no health insurance, section 80D(2)© and (d) allow medical expenditure instead, up to Rs 50,000. The first proviso to section 80D(2) confines this to an amount “paid in respect of a senior citizen and no amount has been paid to effect or to keep in force an insurance on the health of such person”. The second proviso caps premium and medical expenditure together at Rs 50,000 for each group.
Section 126 of the 2025 Act carries the same limits: Rs 25,000 for premium in sub-section (2)(a) and (b), raised to Rs 50,000 for a senior citizen by sub-section (8)(a); Rs 50,000 for medical expenditure in sub-section (2)© and (d); and the Rs 50,000 aggregate cap in sub-section (4). Sub-section (7) allows the medical expenditure deduction “where the amount is paid on account of medical expenditure incurred on the health of a senior citizen … if no amount has been paid to effect or to keep in force the health insurance of such person”. The wording differs from the 1961 Act. Sub-sections (2)© and (d) allow medical expenditure on the assessee, the family or a parent without saying that the person must be a senior citizen, and sub-section (7) adds the no-insurance condition only where the person is one. Read on its words, medical expenditure on a person under 60 falls within sub-section (2)© or (d), within the Rs 50,000 aggregate cap in sub-section (4), with no insurance condition at all. The 1961 Act confined this deduction to senior citizens without insurance. No circular or rule has yet said whether the wider reading was intended.
Specified diseases: Rs 1,00,000
Section 80DDB allows the amount actually paid for treatment of the diseases listed in the rules, up to Rs 40,000. The third proviso raises the limit to Rs 1,00,000 where the patient (the assessee, a dependant or an HUF member) is a senior citizen. A prescription from a specialist is required, and any insurance or employer reimbursement reduces the deduction. Section 128(1) and (4) of the 2025 Act give the same Rs 40,000 and Rs 1,00,000.
Under the new regime
Section 115BAC(2)(i) requires total income to be computed without any deduction under Chapter VI-A other than sections 80CCD(2), 80CCH(2) and 80JJAA. Section 202(2)(a)(xii) of the 2025 Act excludes all of Chapter VIII other than sections 124(1) and (2), 125(2) and 146. Sections 80TTB, 80D and 80DDB, and their counterparts in sections 153, 126 and 128, are therefore lost under the new regime. Two deductions that do survive matter to pensioners: the standard deduction of Rs 75,000 and the larger family pension deduction. Both are covered in Pension, Commuted Pension and Family Pension.
A worked example: one pensioner, two regimes
A resident aged 68, AY 2026-27. Pension Rs 6,00,000; fixed deposit interest Rs 1,20,000; health insurance premium for self and spouse, both over 60, Rs 40,000.
| Old regime | New regime | |
|---|---|---|
| Pension | Rs 6,00,000 | Rs 6,00,000 |
| Less standard deduction (s.16(ia)) | Rs 50,000 | Rs 75,000 |
| Fixed deposit interest | Rs 1,20,000 | Rs 1,20,000 |
| Gross total income | Rs 6,70,000 | Rs 6,45,000 |
| Less s.80TTB | Rs 50,000 | not allowed |
| Less s.80D | Rs 40,000 | not allowed |
| Total income | Rs 5,80,000 | Rs 6,45,000 |
| Tax before rebate | Rs 26,000 | Rs 12,250 |
| Rebate (s.87A) | nil (income above Rs 5,00,000) | Rs 12,250 |
| Tax plus 4 per cent cess | Rs 27,040 | nil |
The old regime tax is 5 per cent of Rs 2,00,000 (Rs 10,000) plus 20 per cent of Rs 80,000 (Rs 16,000). The new regime tax is 5 per cent of Rs 2,45,000. The larger rebate and higher nil band outweigh the lost deductions at this level of income. That will not hold for every pensioner, and the arithmetic has to be done each year.
No advance tax without business income
Section 207(2) of the 1961 Act provides that the advance tax obligation “shall not apply to an individual resident in India, who (a) does not have any income chargeable under the head ‘Profits and gains of business or profession’; and (b) is of the age of sixty years or more at any time during the previous year”. Section 403(3) of the 2025 Act is in the same words for tax years.
Pension, interest, rent and capital gains are not business income, so a resident senior citizen with only those pays no advance tax. Any tax still due after TDS is paid as self-assessment tax before filing, under section 140A of the 1961 Act or section 266 of the 2025 Act. Because such a person is not “liable to pay advance tax”, interest under section 234B and section 234C (sections 424 and 425 of the 2025 Act) does not arise. A senior citizen with any business or professional income, even presumptive income, falls back into the ordinary rules. They are explained in Advance Tax and Self-Assessment Tax.
TDS on interest and the return
Banks deduct tax on interest above a threshold. For a senior citizen, the threshold in section 194A(3) was raised from Rs 50,000 to Rs 1,00,000 by the Finance Act, 2025, from 1 April 2025. Section 393(1), Table serial number 5(ii) of the 2025 Act keeps Rs 1,00,000 “in the case of a senior citizen”. A senior citizen whose tax will be nil can ask the payer not to deduct at all. The procedure is in Form 15H for Senior Citizens.
The duty to file a return is not lifted at sixty. Under section 139(1) of the 1961 Act and section 263(1)(a)(iii) of the 2025 Act, a return is due where total income, before Chapter VI-A (now Chapter VIII) deductions, exceeds the maximum amount not chargeable to tax. Other triggers in those provisions, such as foreign assets, also apply. The one age-based exception is for residents aged 75 or more whose only income is pension and interest from one specified bank. It is covered in No Return at 75-Plus: Section 194P. A walkthrough of a typical pensioner’s ITR-1 is in Filing ITR-1 for a Senior Citizen with Pension and FD Interest.
What to have ready
- Date of birth and residential status. These decide the slab under the old regime and eligibility for every deduction in this guide.
- Pension certificate or Form 16 from the pension-paying bank or employer. This gives gross pension and TDS.
- Interest certificates from each bank and post office, split by savings, fixed and recurring deposits. Check these against the AIS (see Reconciling AIS, TIS and Form 26AS).
- Health insurance premium receipts showing the mode of payment, and medical bills where there is no insurance.
- Specialist prescription and bills for any section 80DDB claim, with any insurance reimbursement.
- Self-assessment tax challans, if TDS falls short.
Summary
- Fix the Act: the 1961 Act for FY 2025-26 (AY 2026-27) and earlier; the 2025 Act from tax year 2026-27.
- Confirm senior citizen status: resident, and 60 or more at any time in the year (80 or more for the higher limit).
- Under the old regime, the nil band is Rs 3,00,000 (60 to 79) or Rs 5,00,000 (80 and above) for both AY 2026-27 and tax year 2026-27. Under the new regime it is Rs 4,00,000 for everyone, with a rebate of up to Rs 60,000 where income does not exceed Rs 12,00,000.
- Under the old regime only, claim interest up to Rs 50,000 (s.80TTB / s.153), health cover up to Rs 50,000 per group (s.80D / s.126) and specified-disease treatment up to Rs 1,00,000 (s.80DDB / s.128).
- With no business income, pay no advance tax (s.207(2) / s.403(3)); pay any balance as self-assessment tax before filing.
- Compare the two regimes, choose in the return, file by the due date, and verify it.
The next guide covers the exemption from filing a return for residents aged 75 or more under section 194P.