Explanation
Section 194P of IT Act 1961 (carried forward under IT Act 2025) introduced a simplified compliance mechanism for senior citizens aged 75 or above. Eligibility: (1) resident individual, (2) aged 75+ in the relevant previous year, (3) has pension income from the same specified bank where their FD interest is earned, (4) no other income source. The bank is designated as a 'specified bank' by CBDT. How it works: the bank computes total income (pension + interest) after applicable deductions (80TTB, standard deduction), determines tax payable, and deducts TDS before crediting the pension. The senior citizen then does NOT need to file an ITR. Certificate in prescribed form must be submitted to the bank. Verify on the income-tax portal before filing.