Understanding Deductions under Section 80

The Income Tax Act provides tax filers many deductions through Chapter 6A which encompasses all of Section 80C, Section 80D, Section 80E etc. These deductions can really help save tax and then even work as a great compounding tool in the future years.

Section 80 Deductions under Income Tax Act :

The Income Tax Act, allows for certain deductions from the gross total income of the assessee. These deductions are given under Chapter 6A of the Income Tax Act.

Such deductions cannot exceed the gross total income of the assessee and apply through Sections 80C to Section 80U.

Income Tax deductions under Section 80 C :

  • Investment in Public provident fund (PPF)
  • National Saving Certificate (NSC)
  • Equity Linked Saving Scheme (ELSS)
  • Life Insurance Premium (LIC)
  • 5 Years Fixed Deposit Scheme
  • Maximum Limits/Condition for deduction (FY 2018-19): Rs. 1,50,000

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More Under Section 80CSection 80 CCCSection 80 CCD(1)Section 80 CCD(2)Section 80 CCD(1B)
Deductions on For money deposited in LIC for any annuity plan or to any other insurer for pension.Employee’s contribution to NPS account (maximum deduction up to Rs.1,50,000)Employer’s contribution to NPS accountAdditional contribution to National pension scheme (NPS)
Maximum Limits/Condition for deduction (FY 2018-19)
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-
Maximum up to 10% of salary Rs. 50,000

Income Tax deductions under Section 80 D :

This deduction is in relation to payment of Medical Insurance Premiums paid by the assesse for himself, his dependent family and parents. Such payments must be made for any medical insurance scheme approved by IRDA (Insurance Regulatory Development Authority).

As such Rs.25,000 is deducitble for medical insurance premiums paid for self, spouse and dependent children. An additional Rs.25,000 is payable towards parent’s medical insurance premiums. As such, the maximum deductible amount can vary depending on the assessee’s age as well as his parent’s age.

To know more about the Deductions Under Section 80 D – Click Here

More Under Section 80 DSection 80 DD Section 80 DDB
Deductions on Handicapped medical treatments /maintenance payments of handicapped person –
  • Disability is 40% or more but less than 80%
  • Disability 80% or more
Medical Expenditure on Self or Relative for diseases specified in Rule 11DD
  • For less than 60 years old
  • For more than 60 years old
  • For more than 80 years old
Maximum Limits/Condition for deduction (FY 2018-19)
  • Rs. 75,000
  • Rs. 1,25,000
  • Maximum of Rs 40,000
  • Maximum of Rs 60,000
  • Maximum of Rs 80,000

Income Tax deductions under Section 80 E :

The deduction is available to an individual assessee against payment of interest on a loan taken from a financial institution or approved charitable institution for higher education.

Higher Education means any study course pursued after senior secondary examination or its equivalent.
Such a loan can be taken for the assessee (i.e. taxpayer), spouse, children or a child for whom the taxpayer is a legal guardian.
There is no restriction on the amount under this deduction;
However the deductions can continue for a period of 8 years starting from the first year of interest payment towards loan or till the loan amount is fully cleared, whichever comes earlier.

Income Tax deductions under Section 80 EE :

Interest on home loan for the first time home owners.
Maximum Limits/Condition for deduction (FY 2018-19): Rs 50,000

Income Tax deductions under Section 80 GG :

This deduction is applicable to individual assessees who are not receiving any HRA as part of the Salary.

The deduction can be claimed against rent paid for a furnished/unfurnished residential accommodation occupied by him for his own residence, and when

the assessee, spouse or child do not own residential accommodation at the place of employment.
The assessee does not have a self-occupied residence at any other place.

Deductions are taken as the lowest of the following –

Rent paid in excess of 10% of the total income
25% of the total income
Rs. 5000 per month

Income Tax deductions under Section 80 GGB :

Companies contribution to Political parties.
Maximum Limits/Condition for deduction (FY 2018-19): Amount contributed (not allowed if paid in cash)

Income Tax deductions under Section 80 GGC :

Persons/Individuals contribution to Political parties.
Maximum Limits/Condition for deduction (FY 2018-19): Amount contributed (not allowed if paid in cash)

Income Tax deductions under Section 80 IAC :

Tax deductions for startups.
Maximum Limits/Condition for deduction (FY 2018-19): 100% of profits & gains derived by an eligible startup business.

Income Tax deductions under Section 80 QQB :

In case the assessee is an author of a certain specified category of books (other than text books) and receives royalty on these, he can avail a deduction against the same. This deduction will subject to the following conditions.

Author includes ‘Joint Author’
Books shall not include the following –
Brochures
Commentaries
Diaries

To know more about the Deductions Under Section 80 QQB – Click Here

Income Tax deductions under Section 80 RRB :

This deduction allows for income from royalties to be deducted, subject to the following conditions –

Royalty is received in respect of patents registered on or after 01/04/2003 under the Patents Act, 1970.
The deduction is upto 100% of the royalty or Rs. 300,000 whichever is lower.
Such a deduction is allowed for a Resident individual patentee.
The assessee must provide a duly signed certificate (Form 10CCE, Form 10H) from the prescribed authority.

Income Tax deductions under Section 80 TTA :

Individuals or HUFs can avail a deduction of a maximum of Rs. 10,000 against interest earned on savings account deposit (not fixed deposits/interest income from corporate bonds/recurring deposits). Such deposit must be made with either

Banking Company
Post Office
Co-operative Society engaged in banking business

Income Tax deductions under Section 80 TTB :

Interest Income from banks, post office etc. Exemption is available only to senior citizens
Maximum Limits/Condition for deduction (FY 2018-19): Maximum up to 50,000

Income Tax deductions under Section 80 U :

This section allows a deduction of

Rs. 75,000 for assessees who suffer from physical disability (including blindness) or mental retardation.
Rs. 125,000 for assessees who suffer from severe physical disability (including blindness) or mental retardation.
Any person applying for a deduction through this route needs to obtain a certificate from the Govt. as dictated under Rule 11A.
As in the case of Section 80DD , a Form 10-IA needs to be furnished where the person suffering from disability (whether severe or not) suffers from autism, cerebral palsy or multiple disabilities.

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