Deduction under section 80 from ITR filing perspective

Understanding deductions under Section 80 of the Income Tax Act is crucial so you can benefit completely from ITR Filing. In this article, you will know all about deduction under section 80 from ITR Filing perspective which will help you get tax benefits.

Section 80C

Maximum Deduction: You can claim a maximum deduction of ₹1.5 lakh per financial year under Section 80C. This limit applies to individuals, Hindu Undivided Families (HUFs), and taxpayers under the age of 60 years.
Eligible Investments: Investments and expenses that qualify for deduction under Section 80C include:
- Employee Provident Fund (EPF) contributions
- Public Provident Fund (PPF) contributions
- Equity Linked Saving Scheme (ELSS) investments
- National Savings Certificate (NSC) purchases
- Tax-saving Fixed Deposits (FDs) with a tenure of 5 years or more
- Sukanya Samriddhi Account deposits
- Life insurance premiums for self, spouse, and children
- Repayment of the principal amount of a home loan (subject to certain conditions)
Cumulative Limit: The total limit of ₹1.5 lakh includes all investments and expenses under Section 80C. You can mix and match these to maximize your benefits.
Lock-in Period: Some investments under Section 80C have a lock-in period. For example, PPF has a lock-in period of 15 years, ELSS has 3 years, and tax-saving FDs typically have 5 years.

Also Read: Benefits of Filing Income Tax Return on Time

Section 80D

Eligible Taxpayers: Section 80D benefits are available to individuals and Hindu Undivided Families (HUFs).
Types of Health Insurance: The deduction is available for premiums paid towards health insurance policies for:
1. Self
2. Spouse
3. Dependent children
4. Parents
Maximum Deduction: The limits depend on who is insured:
1. ₹25,000 per annum for self, spouse, and dependent children.
2. An additional ₹25,000 for the health insurance of parents. If parents are senior citizens (aged 60 or above), the limit increases to ₹50,000.
Preventive Health Check-up: You can claim up to ₹5,000 per annum for preventive health check-ups for yourself, spouse, dependent children, and parents. This is included in the overall limit.
Mode of Payment: Premiums must be paid through any mode other than cash to claim the deduction.
Tax Benefits: This deduction reduces your taxable income, thereby lowering your tax liability.

Section 80E

Interest paid on education loans for higher studies qualifies for deduction. There is no upper limit on the amount, but the deduction can be claimed for up to eight years.

Section 80G

Donations to specified funds and charitable institutions are eligible for this deduction. The amount varies based on the fund or institution and is subject to certain limits.

Section 80TTA and 80TTB

These sections allow deductions for interest income earned from savings accounts (80TTA) and for interest income earned by senior citizens (80TTB). The maximum deduction under 80TTA is ₹10,000, while the limit under 80 TTB is ₹50,000.

Section 80CCD

The maximum limit of deductions under 80CCD(1) is ₹1.5 lakh per financial year. Section 80CCD(1B) provides an additional deduction of up to ₹50,000 for contributions to NPS over and above the deductions under 80CCD(1), applicable if you opt for the old tax regime.

Documents Required

Keep proper documentation, like premium payment receipts and health check-up receipts, to claim these deductions when filing your income tax returns.

Conclusion

In conclusion, Section 80 offers various deductions to minimise tax liabilities, covering investments, health insurance, education loans, and charitable donations. Understanding eligibility criteria, limits, and documentation requirements is key to claiming deductions accurately. Furthermore, consulting a tax advisor from E-StartupIndia’s team can help you ensure compliance with the latest tax laws and maximise your tax savings.