The average age of Indians is on the rise mostly because of the better economic status and healthcare facilities that have emerged over the years.
- 40% has been the rise in life expectancy over the past 38 years.
- Over the past four years, (2005-8), life expectancy has gone up by more than 4 years.
- 7.5% of India’s population falls in the senior category.
Live longer- 1970: 49
- 1990:58
- 2005: 64
- 2008:68.6
Life expectancy in years; Source: Unicef
The gender gap
- Men: 37 million
- Women: 38 million
(No. of men and women over 60 years in India)
Rates of relevance for seniors
- 20-25% is the discount offered by airlines to senior citizens on full economy fares.
- Rs 60,000 is the deduction under Section 80DDB for medical treatment of those above 65 years.
- 9% is the quarterly interest rate for the Senior Citizens Savings Scheme.
- 60 is the age at which the Indian Railways starts giving discounts to the elderly.
- 0.5-1% is the additional interest on bank fixed deposits that senior citizens can avail of.
- 65 is the age when senior citizens can begin availing of tax benefits.
- 50% is the concession for women above 60 years across all classes of rail travel.
Taxation |
|---|
| Taxable Income (Rs) | Tax Liability (Rs) |
| 2 lakh | 0 |
| 4 lakh | 28,325 |
| 6 lakh | 79,825 |
| 8 lakh | 1,41,625 |
| 10 lakh | 2,03,425 |
| 12 lakh | 2,91,747.5 |
| 14 lakh | 3,59,727.5 |
| 16 lakh | 4,27,707.5 |
| 18 lakh | 4,95,687.5 |
| 20 lakh | 5,63,667.5 |
| After full benefit of Section 80C and Section 80D; Tax liability includes surcharge and education cess and has been calculated for the financial year 2008-9. |
| |
Tax Rates |
| Total Income (Rs) | Senior Citizens |
| Up to Rs 2.25 lakh | Nil |
| Rs 2.25 lakh to Rs 3 lakh | 10 |
| Rs 3 lakh to Rs 5 lakh | 20 |
| Above Rs 5 lakh | 30 |
| • A surcharge of 10% is applicable if the total income exceeds Rs 10 lakh. |
| • Education cess of 3% is payable on the amount of income tax (including surcharge) for all income levels. |
Health Insurance
A look at the premium rates for various mediclaim policies for senior citizens across insurance companies.
The takeaways:
- You can avail of tax deduction up to Rs 20,000 under Section 80D.
- If you had taken a policy earlier, continue with it into old age and get discounts for claim-free years. This will help bring down your premium cost.
- Let’s assume that someone takes a health insurance plan for Rs 2 lakh at 35 years and continues it till 60 years and beyond. Given the current premium rates, it works out to an average premium of Rs 5,000 a year for the next 25 years.
