The impact of Deductions available under various sections of Income Tax Act is not same for all. It depends upon applicable tax rates as per the total taxable income and status of assessees. An assessee, whose income is taxable at higher rates will have more tax savings i.e. more impact on his / her tax liability than the assessee whose income is taxable at lower rates.
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Deductions Allowable under various sections of Chapter VIA of Income Tax Act:
• Section 80C – Subject to the overall limit of Rs. 1,50,000 under Section 80CCE, Additional deduction U/s 80CCD(2) & U/s 80CCD(1B)
For investments in specified schemes, saving instruments etc.
1. Life insurance premium for policy:
a) in the case of an individual, on the life of assessee, assessee’s spouse and any child of assessee
b) in the case of HUF, on the life of any member of the HUF
a) in the case of an individual, on the life of assessee, assessee’s spouse and any child of assessee
b) in the case of HUF, on the life of any member of the HUF
2. The sum paid under a contract for a deferred annuity:
a) in the case of an individual, on the life of the individual, individual’s spouse and any child of the individual (however, the contract should not contain an option to receive a cash payment in lieu of annuity)
b) in the case of HUF, on the life of any member of the HU
a) in the case of an individual, on the life of the individual, individual’s spouse and any child of the individual (however, the contract should not contain an option to receive a cash payment in lieu of annuity)
b) in the case of HUF, on the life of any member of the HU
3. Sum deducted from salary payable to Government servant for securing deferred annuity or making provision for his wife/children [qualifying amount limited to 20% of salary]
4. Contributions by an individual made under Employees’ Provident Fund Scheme
5. Contribution to Public Provident Fund Account in the name of:
a) in the case of an individual, such individual or his spouse or any child of such individual
b) in the case of HUF, in the name of any member thereof
a) in the case of an individual, such individual or his spouse or any child of such individual
b) in the case of HUF, in the name of any member thereof
6. Contribution by an employee to a recognized provident fund
7. Contribution by an employee to an approved superannuation fund
8. Subscription to any notified security or notified deposit scheme of the Central Government.
For this purpose, Sukanya Samriddhi Account Scheme has been notified vide Notification No. 9/2015, dated 21/1/2015. Any sum deposited during the year in Sukanya Samriddhi Account by an individual would be eligible for deduction. The amount can be deposited by an individual in the name of her girl child or any girl child for whom such an individual is the legal guardian.
For this purpose, Sukanya Samriddhi Account Scheme has been notified vide Notification No. 9/2015, dated 21/1/2015. Any sum deposited during the year in Sukanya Samriddhi Account by an individual would be eligible for deduction. The amount can be deposited by an individual in the name of her girl child or any girl child for whom such an individual is the legal guardian.
9. Subscription to notified savings certificates [National Savings Certificates (VIII Issue)]
10. Contribution for participation in unit-linked Insurance Plan of UTI:
a) in the case of an individual, in the name of the individual, his spouse or any child of such individual
b) in the case of an HUF, in the name of any member thereof
a) in the case of an individual, in the name of the individual, his spouse or any child of such individual
b) in the case of an HUF, in the name of any member thereof
11. Contribution to notified unit-linked insurance plan of LIC Mutual Fund:
a) in the case of an individual, in the name of the individual, his spouse or any child of such individual
b) in the case of an HUF, in the name of any member thereof
a) in the case of an individual, in the name of the individual, his spouse or any child of such individual
b) in the case of an HUF, in the name of any member thereof
12. Subscription to notified deposit scheme or notified pension fund set up by National Housing Bank [Home Loan Account Scheme/National Housing Banks (Tax Saving) Term Deposit Scheme, 2008]
13. Tuition fees (excluding development fees, donations, etc.) paid by an individual to any university, college, school or other educational institution situated in India, for full-time education of any 2 of his/her children
14. Certain payments for purchase/construction of residential house property
15. Subscription to notified schemes of (a) public sector companies engaged in providing long-term finance for purchase/construction of houses in India for residential purposes/(b) authority constituted under any law for satisfying need for housing accommodation or for planning, development or improvement of cities, towns, and villages, or for both
16. Sum paid towards notified annuity plan of LIC or another insurer
17. Subscription to any units of any notified [u/s 10(23D)] Mutual Fund or the UTI (Equity Linked Saving Scheme, 2005)
18. Contribution by an individual to any pension fund set up by any mutual fund which is referred to in section 10(23D) or by the UTI (UTI Retirement Benefit Pension Fund)
19. Subscription to equity shares or debentures forming part of any approved eligible issue of capital made by a public company or public financial institutions
20. Subscription to any units of any approved mutual fund referred to in section 10(23D), provided the amount of subscription to such units is subscribed only in ‘eligible issue of capital’ referred to above. 21. Term deposits for a fixed period of not less than 5 years with a scheduled bank, and which is in accordance with a scheme framed and notified.
21. Subscription to notified bonds issued by the NABARD.
22. Deposit in an account under the Senior Citizen Savings Scheme Rules, 2004 (subject to certain conditions)
23. 5-year term deposit in an account under the Post Office Time Deposit Rules, 1981 (subject to certain conditions)
• Section 80CCC (Premium for annuity plans)
• Section 80CCD(1) (Assessee's contribution to pension a/c)
• Section 80CCD(2) (Employer's contribution to pension a/c)
• Section 80CCD (Additional contribution to NPS)
• Section 80CCG
• Section 80D (Medical/health insurance)
• Section 80DD (Reh. of handicapped dependent relative)
• Section 80DDB (Medical ex. on self/dependent relative)
• Section 80E (Inst. on loan for higher studies)
• Section 80G (Donations)
• Section 80EE (Int. on loan for residential house property)
• Section 80G (Donations)
• Section 80GG (House rent)
• Section 80GGA (Donations)
• Section 80GGC (Sci. Research/Rural Dev.)
• Section 80RRB (Royalty on patents)
• • Section 80TTA (Saving bank in.)
• Section 80U (Physical disability)
• Section 24 (Home loan int.)
• Section 80CCD(1) (Assessee's contribution to pension a/c)
• Section 80CCD(2) (Employer's contribution to pension a/c)
• Section 80CCD (Additional contribution to NPS)
• Section 80CCG
• Section 80D (Medical/health insurance)
• Section 80DD (Reh. of handicapped dependent relative)
• Section 80DDB (Medical ex. on self/dependent relative)
• Section 80E (Inst. on loan for higher studies)
• Section 80G (Donations)
• Section 80EE (Int. on loan for residential house property)
• Section 80G (Donations)
• Section 80GG (House rent)
• Section 80GGA (Donations)
• Section 80GGC (Sci. Research/Rural Dev.)
• Section 80RRB (Royalty on patents)
• • Section 80TTA (Saving bank in.)
• Section 80U (Physical disability)
• Section 24 (Home loan int.)
