DTC : Annual deduction raised to Rs. 1.5 lakh

Under the DTC Bill, the annual deduction has been raised to Rs. 1.5 lakh. From the bill  It appears that investments in PPF, PF, NPS, pure life insurance policies, savings schemes as notified by the government are eligible for this deduction under EEE category.

EEE refers to tax exemption at time of investment, accumulation and withdrawal. Based on available information, it is unclear whether ELSS and premium for ULIP will be eligible for deduction or not.

If they are eligible for deduction, it will only be under the EET category — exempted from taxation at time of investment and accumulation, but taxable at the time of withdrawal.

Deduction for principal repayment of home loans has been done away with.