The Various Income Tax Deductions Under Section 80 in India Get Details
Section 80C, 80CCC and 80CCD
An individual can claim a maximum deduction of Rs. 1.5 Lakhs under Section 80C, Section 80CCC and Section 80CCD.
Some of the investment schemes that are eligible for tax deduction are
Section 80CCG - Rajiv Gandhi Equity Scheme (RGESS)
Additional deduction of the 50% of the investment can be claimed under this scheme. This scheme is only for first-time investors in share market with income less than Rs. 10 Lakhs.
Section 80D - Medical Insurance Deduction
Under this section tax deduction is available on the premium made towards the medical insurance taken by an individual for himself or his/her family.
A deduction of Rs. 50,000 and Rs. 75,000 can be claimed on the amount spent on the treatment and care of a disabled individual. If an individual is certified as either physically or mentally disabled, deduction of the medical expenses incurred in caring for the individual can be obtained (Rs. 50,000 for normally disabled and Rs. 75,000 for severely disabled).
Section 80DDB - Serious Ailment Deduction
A person can avail deduction of Rs. 40,000 on tax for the treatment of serious diseases. The deduction is available for the expenditure on the treatment of disease for self or for the family. The illness should be verified by a certified doctor and an amount of Rs. 80,000 is available for deduction in case of a senior citizen.
Section 80E - Deduction on loan for Higher Studies
The deduction can be claimed on education loan (up to 7 years in the case of higher education). This benefit is only available for immediate family members such as the spouse, children etc.
Section 80G - Deduction on Donations
Any taxpayer can get a deduction of 50 to 100 percent on taxes, depending on the entities where the donations are made towards.
Section 80 GG - Deduction on House Rent
People who do not receive HRA from their employer can claim a tax deduction on the rent they pay under this Section. A deduction of Rs. 60,000 annually (Rs. 5,000 per month) is available under specific circumstances if their rent is less than 10% of the salary or 25 % of the whole income.
Section 80 TTA - Saving Account Interest Deduction
If the tax payable at the end of financial year is less than Rs. 10,000, then the interest received on the savings account is not accounted for taxable income.
Section 80U - Deduction for Disabled
Any person suffering from a disability can be granted a deduction on his/her taxable income. An amount of Rs. 50,000 is usually available for deduction but in the cases of severely disabled the amount can increase up to Rs. 1 Lakh.
Section 80 GGA - Rural Development Donation Deduction
Any taxpayer can claim a deduction in case the donations are made towards rural development or scientific research.
Section 80 GGC - Donation to Political Parties Deduction
In case an individual is contributing money to any political party, the deduction is available on it under this section.
Section QQB - Deduction on Royalty from Patent
If a person earns his/her income through royalties received from patent then maximum deduction of Rs. 3 Lakhs is available on it.
Section 80 RRB - Deduction on Royalty from Books
If a person receives royalty income from the sale of books, journals or any other literature, then he/she can avail a tax deduction of Rs. 3 Lakhs on it.
An individual can gain additional tax benefit under this head. A tax deduction is available on the interest paid towards the car loan. This benefit can be only enjoyed by individual taxpayers who are either self-employed or own a business. No salaried individual can avail this deduction. To avail this claim, one must declare the profit or capital gains earned and mention if the car will be used for business purposes. This deduction on the interest of the car loan is available under Section 80C.
The government has provided various schemes and policies for claiming tax exemptions for earning women.
Section 54 and 54F
Under this section exemption from the taxes can be claimed on capital gains if the gains are invested in either buying or constructing of a house property. The new property must be bought a year or two after the sale of original property or the house is constructed within three years. This is only available if the person does not have any other property except for the original one and the property is located within India. The capital gain deposit account scheme is also available for the benefit.
An assessee can avail exemption on the capital gains from the sale of agricultural land that he/she utilized for agricultural purposes. The assessee must buy new agriculture land within two years of the sale and then gain tax exemption on it. Investment of the gains in Capital gain deposit account scheme is also available.
Any individual can claim exemption under this section on the sale of assets. It is essential that the asset is a long-term capital asset and is sold after a period of three years from the time it was acquired. The gains from the sale can be invested in NHAI (National Highway Authority of India) and REC (Rural Electrification Corporation) bonds, which should be done within a period of six months. A maximum amount of Rs. 50 Lakhs and Rs. 45 Lakhs can be invested in the bonds respectively. The capital gain deposit account scheme is not available under this Section.
It is important to take into notice that the income from capital gains can be only invested in one scheme or asset. Even if an assessee sells two assets together, the capital gain earned from the sale is to be invested only once. If the earning is invested more than once then tax is liable on it.