Tax Slabs

Income Tax Deduction Section List


Taxes are the basic income source for the government. Infrastructure, scientific research, and defense are funded through these different welfare schemes. Paying taxes is the duty of every individual with a standard income source. When you pay taxes regularly, you take one step towards becoming a dutiful citizen. Paying taxes enables you to get approvals for loans and visas. You also get benefits from the investments made by the government through the taxes you pay. 

But sometimes, tax planning is equally important to help you save more and reduce your financial distress. And for more income tax deductions, the Government of India came up with different sections of the Income Tax Act, of 1961. For example, section 80(C) is one such provision that allows you to save tax on the income you generate through investments. 

Want to know more about the different tax deduction provisions to save more? Well, then this article is the right place for you to find out the answer to this question. In this article, you will find out about different income tax deduction sections of the Income Tax Act. 

Income Tax Deduction Section List:

In action, there are several sections of the 1961 Income Tax Act that enable you to save tax, mainly under Section 80. These sections touch upon different subjects like investments, health insurance, education, etc. 

The first one is Section 80(C). This is subject to the income tax deduction under the investment category. The second one is Section 80(D), subject to a tax deduction on the premium of your health insurance. The third one is Section 80(E). Under this, there is a tax deduction under the education category. Under the fourth section, there is a significant tax deduction on all types of donations. This is Section 80(G). 

Then comes Section 80(IA). It covers income tax deductions on all types of industrial activities. Section 80(TTA) permits the deduction of tax only to individual taxpayers and Hindu Undivided Families (HUF). The section stressing income tax deductions of the category that entails persons with disabilities is Section 80(U).

Similarly, there are different other sections like Section 80(RRB), Section 80(QQB), Section 80(P), Section 80(LA), and Section 80(J). However, in this article, we will be discussing all the sections and subsections of Section 80(C).

Section 80(C): Aim, Provisions, and Significance

Section 80(C) of the Income Tax Act, 1961, provides certain tax exemptions to both individual taxpayers and Hindu Undivided Families (HUF). The taxpayers who fall under this eligibility criteria are allowed to claim a deduction of up to 1.5 lakh rupees. That means the income you generate from the different investment schemes is subject to an income tax deduction of the aforementioned limit. 

The different investment schemes that fall under the eligibility of this section are:

  • Life Insurance Policies
  • Superannuation or Provident Funds
  • Education fees for a maximum of two of your children
  • Payment made for construction purposes
  • Equity Linked Savings (ELS), National Pension Scheme (NPS), Public Provident Fund (PPF), Employee Provident Fund (EPF), Fixed Deposits, Unit Linked Insurance Plan (ULIP), etc. 

What are the different subsections of Section 80(C) and what is their significance? 

There are four subsections under Section 80(C), and they are Sections 80(CCC), 80(CCD), 80(CCF), and 80(CCG). Different sections focus on different subjects related to income tax deductions

  1. Section 80(CCC):

This subsection of Section 80(C) focuses on tax deductions related to all categories of pension funds. So, as said earlier, you can claim a deduction of up to Rs. 1.5 lakh under this subsection. However, the provisions of this section are only applicable to individual taxpayers. 

  1. Section 80(CCD):

This subsection of Section 80(C) also encourages individuals to invest regularly under different pension schemes to increase their worth and ensure their social security. According to this section, contributions made by an individual taxpayer are eligible for an income tax deduction of up to 10% of the person’s salary, including the Dearness Allowance. 

The other subcategory of this section is Section 80 (CCD)-1. This section is specially designed for those individuals who invest under the National Pension System. According to this section, the investors in NPS are subject to an additional income tax deduction of up to 50,000 rupees. 

  1. Section 80(CCF):

Unlike sections 80(CCC) and 80(CCD), this subsection applies to both individual taxpayers and the Hindu Undivided Families (HUF). According to section 80(CCG), taxpayers can claim a maximum tax deduction of up to 20,000 rupees on only subscriptions to long-term infrastructure bonds. 

  1. Section 80(CCG):

This subsection of Section 80(C) allows individual taxpayers to claim an income tax deduction of up to 25,000 rupees per year on investments made in equity saving schemes, provided the limit is 50 percent of the invested amount. 

Summing it up:

Saving taxes decreases the financial burden on your expenses and encourages you to make more investments. However, knowing about these income tax deduction sections is mandatory, and claiming them is your right. You must be aware of all your tax-related rights and devise a smart tax planning strategy to open doors for a better future. 

If you like reading about these topics and want to learn more about taxation and different investment schemes, you should probably visit Piramal Finance.