Deduction under Income Tax various section

Section 80C Deduction

As per Income Tax Act, Section 80C deduction is an available underpayment of LIC Premium, Tuition Fee, deposit under Sukanya Samriddhi Yojna, NSC, ELS, Kisan Vikas Patra, EPF and Pension funds.

Taxpayers can claim a maximum deduction of up to Rs.1.5 lakhs under Section 80C, 80CC, and 80CCD.

Eligible for Deduction Section 80C (Deposit)

Fixed Deposit

As per bank term deposit scheme 2006, taxpayers eligible for deduction under section 80C the FD made for a minimum period of 5 years provided they should not commit to secure the loan.

Nation Saving Scheme 

The National Savings Certificate (NSC) is an investment scheme floated by the Government of India. It is a savings bond that allows subscribers to save income tax. There is no maximum limit on the purchase of NSCs, but investments of up to Rs 1.5 lakh in the scheme can earn a tax break under Section 80C of the Income Tax Act. 

Sukanya Samriddhi Yojna

Sukanya Samriddhi Yojna launched by our PM under Brand Name Beti Bachao Beti Padhao Yojana Scheme. A taxpayer can get deduction under 80C who deposited under this yojna.

Eligible for Deduction Section 80C (Investment)

Investment in Infrastructure 

The investment made in form of equity or debenture issued by Public company or Financial institution which is utilized for development or maintaining of infrastructure under MOU with Central Govt or State e Govt or Local Govt body is allowed as a deduction under section 80C

Investment in Mutual Funds in Infrastructure 

The taxpayer can investment Mutual Funds for Infrastructure development exclusively working development or maintaining of infrastructure under MOU with Central Govt or State e Govt or Local Govt body are allowed as a deduction under section 80C

Equity Linked Saving Scheme, 2005

The taxpayer can avail deduction 80C under Equity Linked Saving Scheme, 2005 (Mutual Funds or UTI). Investment amount would be locked for 3 Year and the amount can be invested in units in multiples of rupees five hundred. 

Insurance Premium

The taxpayer can avail the benefits of the Insurance premium paid for self, spouse or child under Section 80C, also taxpayer can avail the deduction of benefits of Unit-linked Insurance Plan, 1971 of LIC or UTI.

Health Insurance & Medical Expenses (80D)

per section 80D taxpayer can avail the deduction up to Rs 25,000 for the medical insurance premium for self, and dependent children and spouse. In the case of a senior citizen, the limit goes up to Rs 50,000

For Self and Family:

• The maximum deduction of Rs.25,000 per year on health insurance premium for self and family.
• The maximum deduction of Rs.50,000 per year if you are a senior citizen.

For Parents:

• The maximum deduction of Rs.25,000 per year on health insurance premium paid on behalf of parents.
• The maximum deduction of Rs.50,000 per year on premium payments for senior citizen parents.

Deduction under Disability (80DD & 80U)

Section 80U deal with disabilities individual himself and section 80DD deal with disabilities of a dependent family member. 

The taxpayer can take a deduction under 80DD the maximum deduction allowed is Rs 75000 for disabled dependents. In case the disabled dependent is a person with severe disability, the maximum deduction allowed is Rs.1.25 lakhs.

Disability means a person suffering from more than 40% disability and Severe disability means a person suffering from more than 80% disability

Medical Certificate required for Claiming Section 80DD Deduction

Who can claim

In case of an individual taxpayer, the deduction under Section 80DD can be claimed for expenses relating to a disabled dependent who can be a spouse, son, daughter, parents, brother or sister.

Deduction for Educational Loan (80E)

Taxpayer is allowed deduction not only on education Loan but also on interest paid on education loan under section 80E

From where the loan should be taken: Bank/financial institution or any approved institution. Loans taken from friends or relatives don’t qualify for the deduction.

The purpose of the loan: The loan should be taken to pursue higher studies. It does not matter whether such education loan is taken for higher studies in India or outside India.

Donations Deduction under Section (80G)

Taxpayer can avail the deduction benefits on certain relief funds can be claimed under section 80G of the Income Tax Act

Cash donation over Rs 2,000 made by way of cash are not qualify deduction under section 80G w.e.f. 1st April 2017.

Taxpayer need to take a receipt from the trust or institution, donation receipt must have name, address and Pan number and 80G registration number of the institution.

In case of 100% deduction are allowed then ensure that you obtain a singed Form 58A from the institution Without Form 58A, a donation will not be eligible for 100% deduction.