Advice sought for income tax exemption of senior citizen

[Debashish M]

Hi,

My mother is a senior citizen (71 years old). Her annual income [which is from various FDs in banks] just about exceeds 3 lakhs by a whisker due to which she did not submit the Form 15H. And the bank is now deducting TDS to the tune of approximately ₹ 8,000 /= every quarter, which amounts to ₹ 32,000 for the year.

I have two queries:

1. As per the income tax rule, the rate of tax for senior citizens under the ₹ 3 to 5 lakhs slab is given as 10% of the amount by which the taxable income exceeds ₹ 3,00,000/-. Now my mother's annual income exceeds the ₹ 3 lakh limit by just ₹ 12,000. Does this mean that TDS will be applied ONLY on the ₹ 12,000? Why I am asking is because in the TDS certificate [Form 16 A] that the banks are sending every quarter, the tax being deducted is on the principal amounts of the individual FDs.

2. How can my mother avail of the Section 80C to be exempt of all tax liability? For instance, I have a PPF account in my name. Can she deposit the same amount by which her income exceeds the taxable income, in this case ₹ 12,000, into my PPF account in March this year? And since the TDS has already been deducted for 2016-17, by when does she have to file a return to get a refund of the tax deducted?

Thanks!

AI Summary

Seeking Advice on TDS Deductions for Senior Citizens & Using Section 80C to Reduce Tax Liability A user seeks advice on income tax exemption for their 71-year-old mother, whose income from fixed deposits slightly exceeds 3 lakhs, leading to quarterly TDS deductions of approximately 8,000. They inquire if TDS applies only to the excess 12,000 over the 3 lakh threshold and seek clarification on why TDS is deducted on principal amounts. Additionally, they ask if their mother can use Section 80C to eliminate tax liability by depositing 12,000 into the user's PPF account and request guidance on filing a return for a refund of the deducted TDS for 2016-17.