Expert verified While Section 80 deductions are largely associated with individuals, there are many section 80 deductions applicable to Indian companies.
Here’s a complete section 80 deductions list for companies along with a brief overview of eligibility criteria and applicable conditions.
The Complete Section 80 Deductions List for Companies
Let’s take a look at the section 80 deductions list for companies in India along with their eligibility conditions requirements:
✅Section 80IA – Infrastructure Development
Eligibility: Companies involved in infrastructure projects including power generation, telecommunications, water supply, sanitation, roads, bridges, and industrial parks.
Deduction: For infra facility – 10 consecutive AY’s out of first 20 years; For others – 10 consecutive AY’s out of first 15 years
Conditions:
- Projects must be approved by specified authorities
- Separate books of accounts must be maintained for eligible business
- Follows specific sector-wise timelines
✅Section 80IAB – SEZ Development
Eligibility: Companies engaged in development of notified Special Economic Zones (SEZs).
Deduction: 100% deduction for 10 consecutive AY’s out of first 15 AY’s
Conditions:
- SEZ must be notified
- Developers must be approved as per SEZ Act and Rules.
✅Section 80IAC: Eligible Startups
Eligibility: Companies recognized as eligible startups, primarily in innovation, technology, etc.
Deduction: 100% of profits for 3 consecutive years out of 10 years
Conditions:
- Incorporated between 1 April 2016 and 31 March 2025
- Turnover under ₹100 crore
- Innovation-driven
✅Section 80IBA: Industrial Undertakings & Housing Projects
Eligibility: Companies engaged in specified industrial activities or developing/builder of approved housing projects.
Deduction: Varies based on type of undertaking – typically 25% to up to 100% of profits for a specified period
Conditions:
- Industrial undertaking must be newly established
- Minimum employment and investment thresholds may apply
- Manufacturing or production activities required
✅Section 80IC: Industries in Specified Backward Areas
Eligibility: Industrial undertakings located in specified industrially backward areas.
Deduction: 10 consecutive AY’s (100% first 5 AY’s, 30% for balance years)
Conditions:
- Location must be in notified backward areas
- Minimum investment and employment criteria
- Manufacturing activities required
- Must commence within notified period
✅Section 80ID: Hotels & Convention Centers in Specified Areas
Eligibility: New 2/3/4-star hotels or convention centers in specified areas.
Deduction: Percentage of profits from hotel business operations.
Conditions:
- New business, not by splitting/reconstruction
- Must be approved and commence within specified dates
- Books must be audited.
- Minimum facility and service standards required
✅Section 80IE: Enterprises in North-Eastern States
Eligibility: New manufacturing/service units in North-Eastern states (Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura).
Deduction: 100% of profits for 10 consecutive years
Conditions:
- Operations must start between 1 April 2007 and 31 March 2017
- Should be new business
✅Section 80JJAA: New Employment Generation
Eligibility: Companies subject to audit under section 44AB, hiring new employees.
Deduction: 30% of additional employee cost for 3 years.
Conditions:
- Additional employees must be employed for at least 240 days (150 days for apparel, footwear/leather)
- Not for business formed by splitting/reconstruction
- Employee salary should not exceed ₹25,000/ month
✅Section 80JJA: Processing Bio-Degradable Waste
Eligibility: Companies engaged in collecting/processing/treating bio-degradable waste.
Deduction: 100% of profits for 5 consecutive years.
Conditions:
- Business must be new
- Approval from prescribed authorities required
- Environmental compliance mandatory
✅Section 80M: Inter-Corporate Dividends
Eligibility: Domestic companies receiving dividends from other domestic companies.
Deduction: Minimum of: Aggregate amount of dividend received or Dividend distributed to shareholders upto due date
Conditions:
- Specific holding period requirements may apply
✅Section 80G: Donations to Charitable Institutions
Eligibility: All taxpayers, including companies, making donations to specified funds/institutions.
Deduction: 50% or 100% of donation amount, with or without qualifying limit.
Conditions:
- Donations must be made via non-cash mode if above ₹2,000
- Donations must be to government-approved charitable institutions
- Institutions must have valid 80G registration
- Maximum deduction limits may apply
✅Section 80GGA: Donations for Scientific Research/Rural Development
Eligibility: Companies donating to approved scientific research or rural development programs.
Deduction: 100% of donation amount
Conditions:
- Donations to approved research institutions or rural development programs
- Payment must be non-cash if above ₹2,000
✅Section 80LA: Offshore Banking Units & IFSCs
Eligibility: Offshore banking units or units in International Financial Services Centre (IFSC).
Deduction: 100% of income for first 5 years, 50% for next 5 years
Conditions:
- Units must be located in approved IFSCs
- Compliance with IFSC regulations required
✅Section 80LAA: Profits from SEZ Exports
Eligibility: Companies exporting articles, things, or software from SEZs.
Deduction: 100% of profits for first 5 years, 50% for next 5 years.
Conditions:
- Operations must be within SEZ
- Export proceeds in convertible foreign exchange
- SEZ regulations compliance mandatory
✅Section 80LAB: Infrastructure Capital Companies/Funds
Eligibility: Infrastructure capital companies and infrastructure capital funds.
Deduction: Deduction on income from infrastructure investments
Conditions:
- Investment must be in approved infrastructure projects
- Minimum investment thresholds and holding periods apply
✅Section 80LAC: Export of Handicrafts
Eligibility: Companies exporting handicrafts
Deduction: 50% of export profits
Conditions:
- Income received in convertible foreign exchange.
- Products must qualify as handicrafts under government definition
✅Section 80HHC: Export of Goods or Merchandise
Eligibility: Companies engaged in the business of exporting goods or merchandise (excluding minerals and ores).
Deduction: Varied over the years; up to 100% in early years
Conditions:
- Exporters earn income in convertible foreign exchange.
- Export proceeds must be received in or brought into India
✅Section 80HHE: Export of Technical Services
Eligibility: Companies earning income from export of computer software or technical services.
Deduction: 50% of such income
Conditions:
- Income must be received in convertible foreign exchange within 6 months from end of previous year
✅Section 80GGB: Donations to Political Parties/Electoral Trusts
Eligibility: Companies making contributions to political parties or electoral trusts.
Deduction: 100% of the amount contributed
Conditions:
- Payment must be non-cash
- Recipients must be a registered political party or approved electoral trust.
✅Section 80HHF: Export of Computer Software
Eligibility: Companies exporting computer software.
Deduction: Similar to 80HHC, specifically for software exports.
Conditions:
- Income must be received in convertible foreign exchange
- Proceeds must be brought to India
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Important Considerations for Availing Section 80 Deductions for Companies
- New Tax Regime Restrictions: Companies opting for special rate of taxation u/s 115BAA or 115BAB will not be allowed certain deductions like section 80IA, 80IAB, 80IAC, 80IB and so on, except deduction u/s 80JJAA and 80M Domestic Company for AY 2025-26 | Income Tax Department
- Sunset Clauses: Many Section 80 deductions have specific time limits and eligibility criteria that companies must meet to claim these benefits.
- Ineligible Deductions: Companies are not eligible for most Section 80 deductions (like 80C, 80D, 80E, 80G, etc.) that are available to individuals.
- New Business: Most deductions cannot be claimed if the business is formed by splitting up or reconstructing an existing business, or by using old plant and machinery beyond allowed limits.
Frequently Asked Questions
- Can companies claim deductions under Section 80 of the Income Tax Act?
Yes, several sub-sections of Section 80 allow companies to claim deductions, especially for donations, infrastructure projects, and SEZ development.
- Is Section 80C available for companies?
No, Section 80C is applicable only to individuals and HUFs, not to companies.
- What is Section 80G and can companies use it?
Yes, companies can claim deductions under Section 80G for donations made to approved charitable institutions.
- Can companies claim deduction for setting up units in SEZs?
Yes, under Section 80-IAB, companies developing SEZs can claim 100% deduction of profits for 10 consecutive year
