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Section 80: Reducing your tax levy with available deductions

section 80 deduction

As the tax filing season slips in, every taxpayer shell out to look for all possible ways to reduce his tax levy. Out of the minimum tax slab exemption, the short deviations provided by the government in the form of deductions under multiple tax sections also work in reducing the taxable income to a great extent.

The Income-tax Act Section 80 allows you to claim deductions on your money spent on medical expenses, insurance investments, charity payments, and retirement benefits availed. These deductions have been allowed to stimulate the society for reinvestment of funds to better income avenues and bring better life expectancy in the economy.

Much of these tax deductions qualify exemptions from our day to day expenses, knowledge of which is must essential for tax saving. In this article, we will highlight all the basic deductions available to every taxpayer while filing Online Income Tax Return under the most prized section of the Income-tax Act – Section 80.

Here’s a synopsis of the Tax deductions available in the Income Tax Act Section 80.

SectionDeduction Maximum Deduction AmountEligible Taxpayer
80CFor Investment made in LIC Policy (for wife, children or self), payments made towards PF, Tuition fees paid, payments for construction or purchase of a residential property, fixed deposits made for a minimum of 5years.Upto Rs 1.5 lakh , in aggregate of 80CCC, 80CCD and 80C.Individual/HUFs
80CCCTax rebates for the investment made in pension fundsUpto Rs 1.5 lakh , in aggregate of 80CCC,80CCD and 80C.Individuals
80CCDFor investments made in pension funds issued by Central Government (eligible for both contributions made by employee and employer)Upto Rs 1.5 lakh , in aggregate of 80CCC, 80CCD and 80C.Individuals
80CCFFor investments made in long term infrastructural bondsUpto Rs 20,000Individual and HUFs
80CCGFor investments made in equity saving schemes specified by the governmentUpto Rs 25,000Individuals
80DFor claiming against payments made towards health insurance premium paid for self, wife children or parents or investment made in any tax saving health plan specified by the governmentUpto Rs 25,000 for self, spouse, or children and additional Rs 25,000 if paid for parents ( below 60 yrs of age) i.e. Rs 50,000 total

 

Upto Rs 30,000 for Parents (over 60 years age). This limit has been increased to Rs 50000 from F.Y. 2018-19 onwards.

Individuals/HUFs
80DDFor payment made towards treatment for disability or purchase of a health insurance plan for self or dependents.Upto Rs 75000 in case of Disability &

 

Upto a maximum of Rs 1.25 lakh in case of severe disability

Individual and HUF
80DDBFor payment made towards medical treatment of a critical disease.Upto Rs 40,000 for self or family

Upto Rs 60,000 if paid for seniors above 60 years.

Individual and HUF
80EFor payment of interest towards premium on loan taken for higher educationNo specified limitIndividual
80EEFor payment of interest as paid on premium on loan taken for purchase of a residential property (Loan value uptoRs 35 lacs and Property vaueuptoRs 50 lacs). Also no other house is owned by asseessee on date of sanction of loan.Upto Rs 50,000Individuals
80GFor payment made as wilful donations made towards charitable institutionsNo specific limit (100% or 50% depending on type of donation)All assessees
80GGFor payment made towards rent payable for hiring house for accommodation, to be availed on non-receipt of house rent allowanceUpto a maximum of Rs5,000 per month or 25% of total income whichever is less.Individuals
80GGAFor payment made as donations towards a National Poverty Eradication fund or any other institution as specified, provided that assessee shall not be in receipt of income from any profession or business.No specific limit. Donation above Rs 10,000 shall be made through banking channels for claiming deduction.All assessee
80GGBFor payment made towards political parties or electoral trustsNo specific limt.

Donation in cash not eligible for deduction.

Indian Companies
80GGCFor payment made towards political parties or electoral trusts excluding contributions from Artificial judicial person and local authorities.No specific limt.

Donation in cash not eligible for deduction.

All assessee
80IAOn gains received by enterprises from industrial activities for instance gains on power generation, SEZs, Industrial parks etc.Upto a maximum of 100% of profit for not more than 10 consecutive years.All assessee
80IABOn gains generated by SEZsUpto a maximum of 100% of profit for not more than 10 consecutive years.All assessee (SEZs owners)
80IBOn gains received from ships, theatres, hotels ,multiplex,cold storage, scientific research and development etcNo specific limitAll assessee
80ICFor gains received from states falling under special category including Mizoram,HP,Tripura,Uttraranchal,Arunachalpradesh,ManipuretcNo specific limitAll assessee
80IDFor gains received from convention centres and hotels.Upto a maximum of 100% of profit for not more than 5 consecutive years.All assessee
80IEFor investments made in projects in North eastern India.

 

Upto a maximum of 100% of profit for not more than 10 consecutive years.All assessee
80JJAFor gains and profits received from business of biological products – biogas, bio-fertilizers etcUpto a maximum of 100% of profit for not more than 5 consecutive years.All assessee
80JJAAFor gains or profits received for manufacturing of goods in factories by Indian companies and employees who have drawn salary for more than 240 days working on contract with such industries excluding workers at administrative and managerial posts30% of additional employee cost for 3 assessment yearsIndian Companies
80LAAvailable for entities including Scheduled Banks , International Financial Service Centres having off shore banking units in SEZs and banks setup abroadUpto a maximum of  100% of Income for 5 consecutive years&

 

50% of income for next 5 consecutive years.

Banks entities
80Pavailable to cooperative societies

i) For societies engaged in fishery, agriculture , cottage and milk industry  .

ii) For other work purposes

iii) For income received on renting warehouses

iv) For income received on interest on loans provided to other societies.

v) For income received as interest for the investment made in securities or property.

Upto 100% for (I) category societies.

From Rs 50,000 to Rs 1 lakh for other category socities.

Cooperative Societies
80 QQBFor royalty received on sale of books related to scientific, artistic and literary, eligible for deduction excluding journals, textbooks and diaries etcUpto a maxium of Rs 3 lakhIndividuals (Authors)
80RRBFor income received as royalty for issuing patent rightsUpto a maximum of Rs 3 lakh.Individuals
80TTAFor interest income received on bank depositsUpto a maximum of Rs 10,000HUFs/Individuals
80UTo be claimed by a person with disability as specified .Upto Rs 75000 in case of Disability &

 

Upto a maximum of Rs 1.25 lakh in case of severe disability

Individuals

 There are unexpectedly many possible ways to save your taxes with the above deductions provided by the government.

If you still find it difficult to match the applicability of the above deductions you can contact our tax expert for Online Income Tax Return Service in Delhi or any part of India at any time by emailing us at support@taxgoal.in or call at +919899693838.

Visit Taxgoal.in

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