Sections 80TTA and 80TTB let you deduct interest income from your taxable income under the old tax regime. 80TTA exempts up to ₹10,000 of savings-account interest for people under 60; 80TTB gives senior citizens up to ₹50,000, and it also covers fixed-deposit interest. For FY 2026-27, neither applies if you use the new regime.
Interest on a bank savings account is not tax-free by default. It is added to your income and taxed at your slab rate. These two sections carve out a slice of that interest, and which one applies is decided by your age, not your choice.
80TTA and 80TTB at a glance
What is Section 80TTA, and what does it cover?
Section 80TTA lets an individual below 60, or a Hindu Undivided Family (HUF), deduct interest earned on savings accounts – with a bank, a co-operative bank, or a post office – up to ₹10,000 in a financial year. The deduction is the actual interest or ₹10,000, whichever is lower.
It applies to savings-account interest only. Interest from fixed deposits, recurring deposits, or bonds does not qualify. Since savings interest is otherwise fully taxable at your slab rate, 80TTA simply keeps the first ₹10,000 of it out of the net. It is available under the old regime alone.
How is Section 80TTB different for senior citizens?
Section 80TTB replaces 80TTA once you turn 60. A resident senior citizen can deduct up to ₹50,000 of interest income, and – this is the key difference – the ₹50,000 covers interest from savings accounts, fixed deposits, and recurring deposits alike, not just savings.
For a retiree living substantially on deposit interest, that wider scope often matters more than the higher cap. As with 80TTA, it is a deduction from gross total income and is available only under the old regime. A senior citizen uses 80TTB, not 80TTA.
Can you claim both 80TTA and 80TTB in the same year?
No. The two are mutually exclusive, and age decides which one applies, not preference. If you are 60 or older during the year, you fall under 80TTB and cannot also take the ₹10,000 under 80TTA. If you are under 60, only 80TTA is open to you. There is no stacking the two limits.
| Feature | Section 80TTA | Section 80TTB |
|---|---|---|
| Who | Individuals under 60, HUFs | Resident senior citizens (60+) |
| Maximum deduction | ₹10,000 | ₹50,000 |
| Interest covered | Savings accounts only | Savings, fixed, and recurring deposits |
| Regime | Old only | Old only |
Do 80TTA and 80TTB apply under the new tax regime?
No. Like most Chapter VI-A deductions, both sit only in the old regime. For FY 2026-27 the new regime is the default, and choosing it means forgoing 80TTA, 80TTB, 80C, 80D and the rest in exchange for its lower slab rates. The old regime is now opt-in.
Whether the old regime works out better than the new one depends entirely on your own income and deductions – that is a comparison to run for yourself, not a rule of thumb.
How much tax does the deduction actually save?
The deduction lowers the interest that is taxed, so the rupee saving is your slab rate times the amount deducted. Take a senior citizen with ₹70,000 of combined savings and fixed-deposit interest in FY 2026-27, taxed under the old regime (illustrative figures). Without 80TTB, all ₹70,000 adds to taxable income. With it, ₹50,000 is deducted and only ₹20,000 remains taxable. If that income sits in the 20% slab, the deduction cuts the tax on that interest by roughly ₹10,000 – that is 20% of ₹50,000 – before cess. The saving never exceeds your slab rate applied to the deducted amount.
Is this the same as the TDS your bank deducts?
No – they work at different stages. A bank deducts TDS (tax deducted at source) on deposit interest once it crosses a yearly threshold, and that is just an advance collection of tax. The 80TTA or 80TTB deduction is claimed later, in your income tax return, and reduces the interest that is actually taxable.
Getting TDS deducted does not stop you from claiming the deduction. A senior citizen whose total income is below the taxable limit can also submit Form 15H to ask the bank not to deduct TDS in the first place.
Related NYVO guides
- Old vs New Tax Regime: How They Differ – why deductions like these belong to the old regime, and how to weigh the trade-off.
- Section 80C: The ₹1.5 Lakh Deduction Explained – the largest of the old-regime deductions, and what qualifies for it.
- Saving vs Investing: Which Comes First? – where savings-account and deposit interest fit in a wider plan.
Interest deductions are small by design – a ₹10,000 or ₹50,000 lid, not a loophole. They matter most for retirees whose income leans on deposits, and only for as long as the old regime stays part of the picture.
