Persons aged 55 years or above are considered as elderly persons for Income Tax purposes and they are eligible to a number of tax concessions. Tax concessions for the elderly provide relief either by reducing the tax payable or removing the tax altogether.

 

Such concessions are in the form of exemptions and credits granted to elderly persons and are provided for under the Income Tax Act [Chapter 23:06], the Finance Act [Chapter 23:04] and the Capital Gains Tax Act [Chapter 23:01].

 

Income Tax Act

 

Exemption on rental income

The rental income accruing to an elderly person, up to a maximum amount of US$3,000 per annum, is exempt from Income Tax. The amount remaining after the exempt portion will be taxed at the normal rates.

 

Exemption on interest

The first US$3,000 of interest accruing to an elderly person from financial institutions such as savings accounts, fixed term deposits, short term investments and other discounted instruments are exempt from Income Tax. The amount remaining after the exempt portion will be taxed at the normal rates.

 

Exemption on pension

The whole amount of a pension received by elderly persons from a pension fund or the Consolidated Revenue Fund is exempt from Income Tax.

Exemption on benefit resulting from motor vehicle disposed to elderly person by employer

Where an elderly person, being an employee, receives a motor vehicle either on termination of employment or otherwise, that benefit is exempt from Income Tax. The elderly person receiving the motor vehicle does not pay any tax for that benefit.

 

 

 

 

Finance Act

 

Elderly person’s credit

Elderly persons who are in receipt of remuneration are also entitled to an elderly persons’ credit of US$900 per annum. A credit is a sum deducted from the tax chargeable to an individual taxpayer.

 

 

Capital Gains Tax Act

 

Exemption on disposal of property

Where an elderly person disposes of a principal private residence (PPR) (that is his/her main residence), the whole amount received on sale of such property is exempt from capital gains tax. This means that no Capital Gains Tax is payable on the whole amount realised from the sale of the property by an elderly person.

 

Exemption on disposal of marketable securities

The first US$1,800 that accrues to an elderly person on the sale of any marketable security is exempt from Capital Gains Tax. The amount remaining after the exempt portion will be taxed at the normal rates. Marketable security means any bond, debenture, share or stock that can be sold in a share market.

 

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