The Union Budget 2025 has introduced revised tax slabs for individuals, including senior citizens, opting for the new tax regime. These new tax rates, announced by Finance Minister Nirmala Sitharaman, will apply for the financial year 2025-26 (assessment year 2026-27). However, no changes have been made to the old tax regime.
Revised Tax Slabs for Senior Citizens Under New and Old Tax Regimes
The government has updated the tax rates under the new regime, while the old regime remains unchanged. Below are the tax slabs applicable to senior citizens for FY 2025-26:
Senior Citizen Tax Slabs for FY 2025-26 (AY 2026-27) – New Tax Regime
| Income Range (₹) | Tax Rate |
|---|---|
| 0 – 4 lakh | Nil |
| 4 – 8 lakh | 5% |
| 8 – 12 lakh | 10% |
| 12 – 16 lakh | 15% |
| 16 – 20 lakh | 20% |
| 20 – 24 lakh | 25% |
| Above 24 lakh | 30% |
Senior Citizen Tax Slabs for FY 2025-26 (AY 2026-27) – Old Tax Regime
| Taxable Income (₹) | Tax Rate |
|---|---|
| Up to ₹3,00,000 | Nil |
| ₹3,00,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Comparison With Previous Year’s Tax Slabs
For reference, the tax slabs for FY 2024-25 (AY 2025-26) were as follows:
Senior Citizen Tax Slabs for FY 2024-25 (AY 2025-26) – Old Tax Regime
| Taxable Income (₹) | Tax Rate |
|---|---|
| Up to ₹3,00,000 | Nil |
| ₹3,00,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Senior Citizen Tax Slabs for FY 2024-25 (AY 2025-26) – New Tax Regime
| Taxable Income (₹) | Tax Rate |
|---|---|
| Up to ₹3,00,000 | Nil |
| ₹3,00,001 – ₹7,00,000 | 5% |
| ₹7,00,001 – ₹10,00,000 | 10% |
| ₹10,00,001 – ₹12,00,000 | 15% |
| ₹12,00,001 – ₹15,00,000 | 20% |
| Above ₹15,00,000 | 30% |
Expectations and Previous Benefits for Senior Citizens
Before the announcement of Budget 2025, senior citizens were hoping for further tax relief to help manage rising costs. Financial experts had suggested measures to ease the financial burden on retirees who primarily rely on their savings.
In the previous budget, the government had introduced several benefits for senior citizens, including:
- Increased Standard Deduction for Family Pensioners: Raised from ₹15,000 to ₹25,000 to provide additional financial relief.
- Higher Standard Deduction Under the New Tax Regime: Pensioners and senior citizens received a higher deduction of ₹75,000.
- Standard Deduction in the Old Tax Regime: Remains ₹50,000 for pensioners and ₹15,000 for family pensioners.
- Simplified Tax Filing for Super Senior Citizens: Under Section 194P, individuals aged 75 and above, whose income comes only from pensions and interest, were exempted from filing income tax returns. Instead, banks were authorized to deduct tax at the source.
Who Qualifies as a Senior Citizen?
According to the Income Tax Act, 1961, individuals aged 60 to 80 years are considered senior citizens, while those above 80 years are classified as super senior citizens.
The new tax slabs reflect the government’s effort to restructure tax rates under the new tax regime, while keeping the old regime unchanged. With these revised slabs, senior citizens will need to assess which tax regime suits them best for the upcoming financial year.
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