Tax Saving under Section 80C – Income Tax Individual and HUF

Allowable deduction under Section 80C of Income tax to avail tax saving benefits upon the payment of amount or deposit of amount.

Limit of deduction under section 80C is Rs. 1,50,000 (In Aggregate)

List of Major deduction eligible under section 80C is as below:

80C Section or deduction under section 80C is applicable to Individual and HUF Only.

Sum needs to deposit or paid for the purpose of claiming deduction under section 80C.

1. Towards insurance on life of a person as below (In case of Individual, Individual himself, Husband or wife, Children’s of Individual).

2. Towards deferred annuity on life of a person as below (In case of Individual, Individual himself, Husband or wife, Children’s of Individual).

3. Contribution by an Individual into an PF fund in which PF Fund Act Applies.

4. Contribution to any provident fund set up by the Central Governments.

5. Contribution by an employee into a recognised provident Fund.

6. Contribution by an employee into an approved superannuation fund.

7. Subscription of any securities of central government in the name of Individual, Husband or Wife, and Children’s in accordance with the deposit scheme as notify by the central government in the official gazette.

8. Subscription into saving certificates of Central Government.

9. Contribution to the Unit-Linked Insurance Plan of Unit Trust of India in the name of Individual, Husband or Wife, and Children’s.

10. Contribution to the Unit-Linked Insurance Plan of LIC Mutual Fund in the name of Individual, Husband, Wife and Children.

11. Contribution into Annuity Plan of Life Insurance Corporation or any other insurance as notify by central government in the official gazette.

12. Contribution into the deposit scheme or pension plan fund setup by the National Housing Bank and in accordance to the notification by the central government in the official gazette

13. Any subscription into deposit scheme of PSU engaged in the business of long-term finance for construction or purchase of house in India for the purpose of residential.

14. Authority constituted in India for the purpose of planning, development or improvement of cities, towns and villages, or for both.

15. Payment of Tuition Fees to

(a) to any university, college, school or other educational institution situated within India;

(b) for the purpose of full-time education of Individual, Wife or Husband and Children’s

Note: Payment towards any development fees or donation or payment of similar nature are not eligible to get deduction.

Tax Saving Under section 80C of Income Tax Act 1961

16. For the purpose of residential property only whether let-out or use by for own residence.

i. Any Instalment or part payment of principle amount under any self-financing or other scheme of any development authority, housing board or other authority engaged in the construction and sale of house property on ownership basis; or

ii. any instalment or part payment of the amount due to any company or co-operative society of which the assessee is a shareholder or member towards the cost of the house property allotted to him; or

iii. Repayment of Amount borrowed by the assessee from

    • the Central Government or any State Government, or
    • any bank, including a co-operative bank, or
    • the Life Insurance Corporation, or
    • the National Housing Bank, or
    • Any Public Limited Company formed or registered with the main objective of carrying on business of providing long term finance for construction pr purchase f house in India for residential purposes.
    • Any company in which the public are substantially interested or any co-operative society, where such company or co-operative society is engaged in the business of financing the construction of houses, or
    • The assessee’s employer where such employer is an authority or a board or a corporation or any other body established or constituted under a Central or State Act, or
    • the assessee’s employer where such employer is a public company or a public sector company or a university established by law or a college affiliated to such university or a local authority or a co-operative society; or

iv. stamp duty, registration fee and other expenses for the purpose of transfer of house property of the assessee but does include any payment towards the cost of any addition or alteration to, or renovation or repair of, the house property which is carried out after the issue of the completion certificate in respect of the house property

Note: Exclusion.

The admission fee, cost of share and initial deposit which a shareholder of a company or a member of a co-operative society has to pay for becoming such shareholder or member; or

17. Investment in to a Term Deposit for a for a fixed period of not less than five years  with a scheduled bank

18. Subscription into such bonds issued by the NABARD

19. Contribution into senior citizen savings scheme rules.

20. Five year time deposit in an account in accordance to the post office time deposit rules’ 1981.

21. Contribution to the pension scheme by an employee of the central government for a fixed period of not less than three years or in accordance of the central governments as notified in the official gazette.

Note: If any equity shares or debentures, with reference to the cost of which a deduction is allowed under sub-section (1), are sold or otherwise transferred by the assessee to any person at any time within a period of three years from the date of their acquisition, the aggregate amount of the deductions of income so allowed in respect of such equity shares or debentures in the previous year or years preceding the previous year in which such sale or transfer has taken place shall be deemed to be the income of the assessee of such previous year and shall be liable to tax in the assessment year relevant to such previous year.

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