What is the basic exemption limit for capital gains for senior citizens?

Senior citizens aged 60-80 years have a basic exemption limit of Rs. 3 lakh per annum, while super senior citizens (above 80 years) have an exemption limit of Rs. 5 lakh per annum. Capital gains within these limits are tax-free.

How can senior citizens save on short-term capital gains tax?

Short-term capital gains from the sale of equity and mutual funds are taxed at 15%. If the total income excluding short-term gains is below the exemption limit (Rs. 3 lakh or Rs. 5 lakh), the unused basic exemption can be applied to reduce the taxable short-term capital gains.

What is the benefit of opting for lower tax slabs under the new tax rules?

Under the new tax system, senior citizens can opt for lower income tax slabs ranging from 5% to 20%, which helps in reducing the tax rate on capital gains, thus lowering the overall tax liability.

Are reverse mortgage loans taxable for senior citizens?

No, the monthly amounts received from banks against property through reverse mortgages are tax-free for senior citizens.

What is the exemption for senior citizens in the STCG?

Short-term capital gains (STCG) are taxed at applicable slab rates for senior citizens, but if their total income is below the exemption limit, no tax is payable.

How can senior citizens save capital gains tax?

Senior citizens can save capital gains tax by reinvesting in specified assets under Sections 54, 54EC, or 54F, or by using capital gains bonds issued by NHAI or REC within six months of sale.

What is the exemption for senior citizens in ITR?

For senior citizens aged 60–79 years, income up to ₹3 lakh is exempt from tax, while for super senior citizens (80 years and above), income up to ₹5 lakh is tax-free.

At what age do you not pay capital gains tax?

There is no specific age at which capital gains tax is completely exempt, but senior and super senior citizens enjoy higher income exemption limits under the Income Tax Act.

Is there any way to reduce capital gains tax?

Yes, one can reduce capital gains tax by investing in capital gains bonds, purchasing another residential property, or adjusting gains against exemptions available under the Income Tax Act.

What is the new tax deduction for seniors?

Senior citizens can claim up to ₹50,000 deduction on interest income under Section 80TTB and enjoy higher medical expense deductions under Section 80D.

How can we avoid capital gains tax?

You can avoid capital gains tax by reinvesting the sale proceeds in another property, capital gain bonds, or by utilizing exemptions available under Sections 54 to 54F.

Should senior citizens pay advance tax on capital gains?

Yes, senior citizens must pay advance tax on capital gains if they have taxable income, unless they have no business or professional income, in which case advance tax is not mandatory.

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6 WaysTo Reduce Senior Citizens Capital Gains Tax During ITR Filing

Pragya Pathak

Author

Updated: 18-10-2025 at 5:30 AM

It is common for aged citizens to rely on their investments and savings to meet their day-to-day needs as they have no fixed source of income post-retirement. However, when assets are liquidated like property, mutual funds, or even stocks by senior citizens, it comes with having to pay capital gains tax on the profit earned on the sale. However, some amount of the tax which is to be paid on capital gains is unavoidable.

Read the article to learn more about tax exemption for senior citizens, including information on income tax slab for senior citizens above 70 years.

Overview

The table below summarises important details about the new income tax slab for senior citizens that one should know.

Income tax for senior citizens pensioners	3 lakh p.a. exemption for people between 60 to 80 years and a limit of Rs. 5 lakh p.a. for senior citizens above 80 years
Tax benefits on short-term capital gains	Taxed at 15% but if the annual income is below 3 or 5 lakh, the unused exemption is adjusted.
Lower tax rates	Ranges from 5 to 20%

6 Ways To Save Up On Capital Gains Tax

Enhanced Basic Exemption Limits:

Under the new income tax slab for senior citizens, there are some new exemption limits based on age:

Income tax slab for senior citizens above 60 years are allotted a basic exemption limit for capital gains, which is at Rs. 3 lakh per annum which can be easily calculated using the income tax slab for senior citizens above 60 years calculator.
Income tax slab for super senior citizens above 80 years are allotted an exemption limit that is comparatively higher which is at Rs. 5 lakh per annum.
Capital gains within these limits remain tax-free for senior citizens.

Tax Benefits On Short-Term Capital Gains:

Advance tax for senior citizens on capital gains that they can save on are laid down below for one’s reference:

Capital gains of a short-term nature acquired from the sale of equity and equity mutual funds receive a 15% tax them.
If the total income, with the exclusion of the short-term gain, is still below Rs 3 lakh or Rs. 5 lakh for the respective age group, then the unused basic exemption can be used against short-term capital gains.

Lower Slab Tax Rates Under The Next Tax Rules:

The lower slab tax rates under the new income tax slab for senior citizens are as follows in brief points:

Senior citizens can choose to opt for lower income tax slabs and also rates which range from 5%-2-% under the new tax system
This new taxation system helps the senior citizens in their goal to reduce their capital gains, as it effectively brings down the tax rate on the capital gains imposed upon them.

Indexation Benefit On Long-Term Capital Gains:

Indexation benefits on long-term capital gains are listed below for one’s better understanding:

Assets that are held over for more than 24 months get their long-term capital gains calculated only after adjusting the purchase cost to indexation.
This substantially reduces the gains, subject to a maximum of at least 20% imposed.

Exemption For Reverse Mortgage Loans:

New tax laws also provide an exemption for reverse mortgage loans in the following way:

The monthly amounts received from banks against property through ways of reverse mortgages are deemed tax-free for senior citizens, helping them cut costs and not lose money to complicated taxation clauses.

Benefit Of Carry Forward Losses:

The exact benefit of carry-forward losses is explained below in detail for one’s reference:

Capital losses can be set off against capital gains of the same type for the current as well as for a grand duration of the next 8 assessment years.

Along with these, deductions such as interest on home loans up to Rs. 2 lakhs also work in favour of the senior citizens, as they help them save taxes on the capital gains imposed.

With proper planning and education, the senior citizens can significantly lower their capital gains tax, which they have to pay.

Conclusion

The Indian tax system provides exemptions, especially for senior citizens, to prevent double taxation and to help meet their regular incomes post-retirement.

By making the most of the available deductions and exemptions, senior citizens can maximise their savings and reduce the tax liability on capital asset sales. Proper understanding and usage of these provisions will allow them to save taxes.

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