ALL ABOUT INCOME TAX ACT DEDUCTIONS

Deductions under Chapter VIA are framed in order to give the benefit to the assessee to save taxes on income provided you invest in certain schemes. The tax benefits under these sections are subject to certain conditions therefore You can plan your taxes considering section-wise deductions available under the Act and the various conditions that need to be fulfilled to claim or be eligible for the same.

There are certain conditions for availing deductions under Chapter VIA which are as follows:

1. The total amount of deductions under Chapter VIA cannot exceed the Gross Total Income of the Assessee. 

Example: Mr.X Whose Gross Total Income is Rs.3,00,000 and the total amount of deductions under Chapter VIA is Rs. 3,50,000/-

The amount of deduction allowable to Mr.X will be restricted to Rs. 3,00,000/- because the deductions cannot exceed the Gross Total Income.

2. Deductions under Chapter VIA will not be allowed against exempted incomes and capital gains.

Section	Who can claim	Nature of Deduction	Maximum Deduction Allowed
80C	Individual/ HUF	Life insurance premium for policy: –  in case of individual, on life of assessee, assessee’s spouse and any child of assessee –  in case of HUF, on life of any member of the HUF Contributions by an individual made under Employees’ Provident Fund Scheme Contribution to Public Provident Fund Account in the name of: – in case of individual, such individual or his spouse or any child of such individual – in case of HUF, any member of HUF Contribution by an employee to a recognised provident fund Contribution by an employee to an approved superannuation fund Subscription to Sukanya Samriddhi Account Scheme. Any sum deposited during the year in Sukanya Samriddhi Account by an individual would be eligible for deduction. Amount can be deposited by an individual or in the name of girl child of an individual or in the name of the girl child for whom such an individual is the legal guardian.Subscription to notified savings certificates [National Savings Certificates (VIII Issue)] Contribution for participation in unit-linked Insurance Plan of UTI : – in case of an individual, in the name of the individual, his spouse or any child of such individual – in case of a HUF, in the name of any member thereof  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 Certain payments for purchase/construction of residential house propertySum paid towards notified annuity plan of LIC (New Jeevan Dhara/New Jeevan Dhara-I/New Jeevan Akshay/New Jeevan Akshay-I/New Jeevan Akshay-II/Jeewan Akshay-III plan of LIC) or other insurer Subscription to any units of any notified [u/s 10(23D)] Mutual Fund or the UTI (Equity Linked Saving Scheme, 2005) 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) Subscription to equity shares or debentures forming part of any approved eligible issue of capital made by a public company or public financial institutionsTerm deposits for a fixed period of not less than 5 years with a scheduled bank, and which is in accordance with a scheme11 framed and notified. Subscription to notified bonds issued by the NABARD.Deposit in an account under the Senior Citizen Savings Scheme Rules, 2004 (subject to certain conditions) 5-year term deposit in an account under the Post Office Time Deposit Rules, 1981 (subject to certain conditions)Contribution to specified account of the pension scheme referred to in 80CCD, in case of central Government employee.	Rs. 1,50,000
80CCC	Individual	Contributions to certain pension funds of LIC or any other insurer	Rs. 1,50,000
80CCD(1)	Individual	Contribution to pension scheme notified by Central Government up to 10% of salary	Rs. 2,00,000 (this includes the additional deduction of Rs 50,000/- available under 80CCD(1B)
80CCD(2)	Individual	Contribution made by employer to pension scheme notified by central Government. However, amount of deduction could not exceed 14% of salary where contribution is made by central government and 10% of salary, where contribution is made by any other employee.
80CCE			80C+80CCC+80CCD(1)<=1,50,000
80D	Individual/ HUF	Amount paid (in any mode other than cash) to LIC or other insurer to effect or keep in force an insurance on the health of specified person. An individual can also make payment to the Central Government health scheme and/or on account of preventive health check-up (subject to limit)specified person means: –   In case of Individual – self, spouse, dependent children or parents –   In case of HUF – Any member thereof Deduction for preventive health check-up shall not exceed in aggregate Rs. 5,000. Payment on account of preventive health check-up may be made in cash.	IndividualFor self, spouse and dependent children : Rs. 25,000 (Rs. 50,000 if person insured is a senior citizen)For parents of the assessee : (Additional) Rs. 25,000 (Rs. 50,000 if person insured is a senior citizen)Medical expenditure if no amount is paid in respect of health insurance-Rs.50,000 (only in case of senior citizen)Aggregate amount of deduction cannot exceed Rs.1,00,000 in any caseHUFPremium up to Rs. 25,000 (Rs. 50,000 if member insured is a senior citizen) paid to insure any member of the family.Medical expenditure if no amount is paid in respect of health insurance-Rs.50,000 (only in case of senior citizen)Aggregate amount of deduction cannot exceed Rs.50,000 in any case
80DD	Resident Individual/ HUF	any expenditure has been incurred for the medical treatment (including nursing), training and rehabilitation of a dependent, being a person with disability any amount is paid or deposited under an approved scheme framed in this behalf by the LIC or any other insurer or the Administrator or the specified company for the maintenance of a dependent, being a person with disability	Rs. 75,000 (Rs. 1,25,000 in case of severe disability)
80DDB	Resident Individual/ HUF	Expenses actually paid for medical treatment of specified diseases and ailments	Rs. 40,000 (Rs. 1,00,000 where expenditure is incurred for a senior citizen
80E	Individual	Amount paid out of income chargeable to tax by way of payment of interest on loan taken from financial institution/approved charitable institution for pursuing higher education (maximum period : 8 years)
80EE	Individual	Interest payable on loan taken by an individual from any financial institution for the purpose of acquisition of a residential house property subject to certain conditions which are as follows:Value of the house should be Rs 50 lakh or lessLoan taken for the house must be Rs 35 lakh or lessThe loan must be sanctioned by a financial institution or a housing finance companyThe loan must be sanctioned between 01.04.2016 to 31.03.2017As of the date of the sanction of the loan, no other house property must be owned by the taxpayer.	Rs 50,000
80EEA	Individual	Interest payable on loan taken by an individual, who is not eligible to claim deduction under 80EE, from any financial institution for the purpose of acquisition of a residential house property subject to certain conditions which are as follows:The taxpayer should be a first-time home buyer. The taxpayer should not own any residential house property as on the date of sanction of the loanThe loan should be sanctioned during the period 1st April 2019 and 31st March 2022Stamp duty value of the house property should be Rs 45 lakhs or lessThe individual taxpayer should not be eligible to claim deduction under the existing Section 80EE	Rs 1,50,000
80EEB	Individual	Interest payable on loan taken by an individual from any financial institution or a NBFC for the purpose of purchase of an electric vehicle subject to certain conditions which are as follows:The loan must be sanctioned anytime during the period starting from 1 April 2019 till 31 March 2023.“Electric vehicle” has been defined to mean a vehicle which is powered exclusively by an electric motor whose traction energy is supplied exclusively by traction battery installed in the vehicle and has such electric regenerative braking system, which during braking provides for the conversion of vehicle kinetic energy into electrical energy.	Rs 1,50,000
80G	All Assessees	Donations to certain approved funds, trusts, charitable institutions/donations for renovation or repairs of notified temples, etc.I   100% Donation without qualifying LimitNational Defence FundPrime Minister’s National Relief Fund Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES FUND) Prime Minister’s Armenia Earthquake Relief FundAfrica (Public Contributions – India) FundNational Children’s Fund (from 1-4-2014) Government or approved association for promoting family planningUniversities and approved educational institutions of national eminence National Foundation for Communal Harmony Chief Minister’s Earthquake Relief Fund (Maharashtra)Zila Saksharta Samitis National or State Blood Transfusion Council Fund set up by State Government to provide medical relief to the poorArmy Central Welfare FundIndian Naval Benevolent Fund and Air Force Central Welfare FundAndhra Pradesh Chief Minister’s Cyclone Relief FundNational Illness Assistance Fund Chief Minister’s Relief Fund or the Lt. Governor’s Relief Fund in respect of any State or Union TerritoryNational Sports Fund National Cultural FundFund for Technology Development and ApplicationIndian Olympic Association, etc. Fund set up by State Government of Gujarat exclusively for providing relief to victims of earthquake in GujaratNational Trust for Welfare of Persons with AutismCerebral palsyMental retardation and Multiple Disabilitiesthe Swachh Bharat Kosh the Clean Ganga Fund (from assessment year 2015-16) and National Fund for Control of Drug AbuseII   50% Donation without qualifying LimitJawaharlal Nehru Memorial FundPrime Minister’s Drought Relief FundIndira Gandhi Memorial TrustRajiv Gandhi FoundationIII  100% Donation with qualifying LimitDonations to the government or any approved local authority, institution or association to be utilised to promote family planningDonation by a company to the Indian Olympic Association or any other notified association or institution established in India to develop infrastructure for sports and games in India or sponsor sports and games in India.IV  50% Donation with qualifying LimitAny other fund or institution satisfies the conditions mentioned in Section 80G(5).Government or any local authority, to be utilised for any charitable purpose other than promoting family planning.Any authority constituted in India to deal with and satisfy the need for housing accommodation or the purpose of planning, development or improvement of cities, towns, villages or both.Any corporation referred to in Section 10(26BB) for promoting the interest of the minority community.For repairs or renovation of any notified temple, mosque, gurudwara, church, or other places.No deduction shall be allowed in respect of donation of any sum exceeding two thousand rupees unless such sum is paid by any mode other than cash.	Qualifying Limit: The eligible donations referred to in III and IV shall be aggregated and the sum total should be limited to 10% of the adjusted total income. This would be the maximum permissible deduction.
80GG	Individuals not receiving any house rent allowance	Rent paid for furnished/unfurnished residential accommodation subject to the following conditions:Taxpayer is self-employed or salariedTaxpayer has not received HRA at any time during the year for which 80GG is claimed.Taxpayer or his/her spouse or minor child or HUF do not own any residential accommodation at the place where taxpayer currently reside, perform duties of the office, or employment or carry on business or profession.In case he/she owns any residential property at any place, for which his/her Income from house property is calculated under applicable sections (as a self-occupied property), no deduction under section 80GG is allowed.Taxpayer has to file Form 10BA with details of payment of rent	The lowest of these will be considered as the deduction under this section- Rs.5,000 per month25% of the total IncomeActual rent less 10% of Income
80GGA	All assessees not having any income chargeable under the head ‘Profits and gains of business or profession’	Certain donations for scientific, social or statistical research or rural development programme or for carrying out an eligible project or scheme or National Urban Poverty Eradication FundNo deduction shall be allowed under this section in respect of any sum exceeding ten thousand rupees unless such sum is paid by any mode other than cash	No Limit
80GGB	Indian Company	Sum contributed to any political party/electoral trustDeduction will not be allowed if sum is contributed in cash	No Limit
80GGC	All assessees, other than local authority and artificial juridical person wholly or partly funded by Government	Sum contributed to any political party/electoral trustDeduction will not be allowed if sum is contributed in cash	No Limit
80U	Resident Individual	Disabled Individuals certified by the medical authority or a government doctorIt is a fixed deduction and is not based on actual expenses	Normal Disability: Rs. 75,000/-Severe Disability: Rs. 1,25,000/-

Section	Who can claim	Nature of Deduction	Maximum Deduction Allowed
80IAC	Company and LLP	Profit and gains derived by an eligible start-up from eligible business on or after 1-4-2017“Eligible business” means a business carried out by an eligible start up engaged in innovation, development or improvement of products or processes or services or a scalable business model with a high potential of employment generation or wealth creation“Eligible start-up” means a company or a limited liability partnership engaged in eligible business which fulfils the following conditions, namely: (a) it is incorporated on or after the 1st day of April, 2016 but before the 1st day of April, 2021 (b) the total turnover of its business does not exceed Rs. 100 crore in the previous years in which deduction is claimed; and (c) it holds a certificate of eligible business from the Inter-Ministerial Board of Certification as notified in the Official Gazette by the Central Government	100% of the profit for 3 consecutive years out of 7 years beginning from the year of commencement
80JJAA	Employer who was subject to tax audit u/s 44AB	Additional Employee Cost (AEC) = Total Emoluments paid or payable to additional employees employed during the previous year subject  to the following conditions:an employee’s total emoluments should be more than INR 25,000 per monthan employee‘s entire contribution should be paid by the Government under the Employees’ Pension Scheme an employee should be employed for a period not less than 240 days during the previous year [150 days in the case of an assessee who is engaged in the business of manufacturing of apparel or footwear or leather products]an employee should participate in the recognized provident fund	30% of additional employee cost for 3 years including the year in which employment is provided
80LA	Offshore Banking Units in SEZ or Unit of IFSC	The deduction will be allowed for the following incomes, to the extent the incomes are included in the gross total income of assessee:Income from offshore banking units in a Special Economic ZoneIncome from the business, referred to section 6 (1) of the Banking Regulation Act, 1949Income from an undertaking located in a special economic zoneIncome from any other undertaking which develops, operates and maintains a special economic zoneThe income from business of any Unit of the International Financial Services Centre	Offshore Banking Unit– 100% of the income (For 5 consecutive years50% of the income (For next 5 years)IFSC – 100% of the income for 10 consecutive years out of 15 years beginning from the year in which permission is obtained
80M	Domestic companies that have declared dividend and are also in receipt of the dividend from another domestic company	A deduction is allowed with respect to the dividend received as long as the same is distributed as dividend one month prior to the due date of filing return.	Lower ofAmount of dividend received from domestic companies; or,Amount of dividend distributed one month prior to the due date of filing return
80P	Cooperative Societies	Income of Cooperative Societies if engaged into certain specified activities	100% deduction
80RRB	Individuals	Royalty on PatentsFor claiming the benefit under this section patent must be registered	Lower of Rs. 3,00,000100% of Royalty Income from Patent
80QQB	Individuals	Royalty Income of Authors	In the case of lump sum payment – Total amount of royalty income subject to a maximum of Rs. 3,00,000.In other cases – Total amount of such income subject to a maximum of 15% of the value of books sold during the previous year
80TTA	Individual or HUF (except senior citizen)	Interest earned on Savings Bank Accounts of Banks, Co-Operatives Banks or Post Office	Lower of Actual Interest earnedRs. 10,000
80TTB	Resident Senior Citizens (60 years or above)	Interest Income earned on deposits (Savings/ FDs) with a banking company, a post office, cooperative, society engaged in the banking business etc.	Lower of • Actual Interest earned• Rs. 50,000