How much pension and how much tax? Know the new rule – Variousinfo


Financial security is one of the most important concerns in old age. The Government of India has launched several pension schemes for senior citizens that provide financial assistance to them. Some important changes have been made in these plans in 2025, about which it is important to know.

In this article, we will give detailed information about the various pension schemes available for senior citizens in 2025, their eligibility, benefit amount and tax rules. We will also shed light on new rules and changes which will benefit senior citizens.

Overview of Senior Citizen Pension Schemes 2025

name of the scheme eligibility monthly pension amount
Indira Gandhi National Old Age Pension Scheme BPL persons above 60 years of age ₹500
Pradhan Mantri Vaya Vandana Yojana over 60 years of age ₹1000 – ₹9250
Atal Pension Yojana 18-40 years of age ₹1000 – ₹5000
national pension scheme 18-65 years of age based on investment
Senior Citizen Savings Scheme over 60 years of age 8.2% annual interest
Central Government Pension Scheme central government employees 50% of base salary

Indira Gandhi National Old Age Pension Scheme

This scheme is for senior citizens above 60 years of age living below poverty line (BPL). Under this, beneficiaries are given a pension of ₹ 500 per month.

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eligibility

  • 60 years of age or older
  • Belonging to BPL family
  • to be selected by the state government

Benefit

  • Pension of ₹500 per month
  • ₹750 per month for persons above 80 years of age

Pradhan Mantri Vaya Vandana Yojana (PMVVY)

It is a guaranteed pension scheme that provides regular income to senior citizens above 60 years of age.

Main characteristics

  • 10 year period
  • Investment from ₹1.62 lakh to ₹15 lakh
  • Guaranteed annual return rate of 8.2%
  • Monthly/Quarterly/Half-Yearly/Annual Pension Options

tax benefits

  • Tax exemption on investment under section 80C
  • Pension income is taxed

Atal Pension Yojana (APY)

This scheme is for unorganized sector workers who want regular pension after the age of 60 years.

eligibility

  • 18-40 years of age
  • Must have a bank account

Benefit

  • Monthly pension of ₹ 1000 to ₹ 5000 after the age of 60 years
  • Government contribution of 50% or ₹1000 (whichever is less)

National Pension System (NPS)

It is a voluntary pension scheme available to all citizens.

Main characteristics

  • 18-65 years of age can join
  • Minimum annual contribution ₹1000
  • You can withdraw 60% of the amount in lump sum at the age of 60 years.
  • It is mandatory to purchase annuity from the remaining 40%

tax benefits

  • Deduction up to additional ₹50,000 under section 80CCD(1B)

Senior Citizens Savings Scheme (SCSS)

It is a safe investment option that provides regular income to senior citizens.

eligibility

  • 60 years of age or older
  • Retired employees aged 55-60 years are also eligible

Main characteristics

  • Tenure of 5 years (extendable up to 3 years)
  • Maximum investment limit ₹30 lakh
  • Current interest rate 8.2% per annum
  • quarterly interest payments
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tax benefits

  • Tax exemption on investment under section 80C
  • TDS applicable on interest income

Central Government Pension Scheme

This scheme is for central government employees who were appointed before 2004.

Main characteristics

  • 50% of base salary as pension
  • Additional pension on age above 80 years
  • provision of dearness relief

Tax Rules 2025 for Senior Citizens

There are some important changes in the tax rules for senior citizens in 2025:

  • Tax exemption limit for senior citizens aged 60-80 years is ₹3 lakh
  • Tax exemption limit for individuals above 80 years of age ₹5 lakh
  • Deduction up to ₹50,000 on interest income on bank deposits and post office deposits under Section 80TTB
  • Exemption from filing income tax returns for persons above 75 years of age (subject to certain conditions)

New rules and changes

There are some important new rules and changes for senior citizens in 2025:

  • Investment limit in PMVVY increased to ₹15 lakh
  • You can continue contributing to NPS even after the age of 60 years.
  • Investment limit in SCSS increased to ₹30 lakh
  • Additional pension benefits to persons above 80 years of age
  • Promotion of digital pension payment

Pension application process

Process to apply for senior citizen pension schemes:

  1. Check Eligibility
  2. Prepare necessary documents (Aadhar Card, Age Proof, Bank Passbook etc.)
  3. Visit the nearest bank branch or post office
  4. Fill the application form and submit documents
  5. Keep checking application status

Disclaimer

The information given in this article is for general information purposes. Although we have tried to provide accurate information, the terms and conditions of the schemes are subject to change from time to time. Before investing or applying for any scheme, please verify with the concerned department or authorized agency. This article is not legal or financial advice of any kind.

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