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Tax benefit-deduction on Investments / Payments / Incomes to Individuals

Here is the list of Tax benefit deductions available to Individual assessee in Income tax act on variouse  Investments / Payments / Incomes in Income tax return for FY 2020-21 AY 2021-22

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      • Section 24(b) – Deduction from Income from House Property on interest paid on housing loan & housing improvement loan. 
      • In case of self- occupied property, the upper limit for deduction of interest paid on housing loan is  ₹ 2 lakh. However, this deduction is not available for person opting for New Tax Regime.

    Interest on loan u/s 24(b) alloweable is tabulated below 

    Nature of PropertyWhen loan was takenPurpose of loanAllowable (Maximum limit)
    Self-OccupiedOn or after 1/04/1999

    Construction or purchase of house property                            

    		₹ 2,00,000
    On or after 1/04/1999For Repairs of house property          ₹ 30,000
    Before 1/04/1999Construction or purchase of house property    ₹ 30,000
    Before 1/04/1999For Repairs of house property ₹ 30,000
    Let OutAny timeConstruction or purchase of house property    Actual value without any limit

     

    Tax deductions specified under Chapter VIA of the Income Tax Act

    These Deductions will not be available to a taxpayer opting for the New Tax Regime u/s 115 BAC, except for deduction u/s 80CCD (2) which will be applicable for New Tax Regime as well

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        • 1. 80C, 80CCC, 80CD(1) Combined deduction limit of ₹ 1,50,000
        • 80C : Deduction towards payments made to Life Insurance Premium Provident Fund Subscription to certain equity shares Tuition Fees National Savings Certificate, Housing Loan Principal Other various items
        • 80CCC : Annuity plan of LIC or other insurer towards Pension Scheme
        • 80CD(1): Pension Scheme of Central Government
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          • 2. 80CCD(1B)Deduction limit of ₹ 50,000
          • Deduction towards payments made to Pension Scheme of Central Government, excluding deduction claimed under 80CCD (1)

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            • 3. 80CCD2 Deduction towards contribution made by an employer to the Pension Scheme of Central Government 
            • If Employer is a PSU, State Government or Others Deduction limit of 10% of salary         
            • If Employer is Central Government Deduction limit of 14% of salary
                
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            • 4. 80D Deduction towards payments made to Health Insurance Premium & Preventive Health check up
            • For Self / Spouse or Dependent Children
            • ₹ 25,000 (₹ 50,000 if any person is a Senior Citizen) ₹ 5,000 for preventive health check up, included in abovethis limit
            • For Parents
            • ₹ 25,000 (₹50,000 if any person is a Senior Citizen) ₹ 5,000 for preventive health check up, included in this limit
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              • 5. 80D Deduction towards Medical Expenditure incurred on a Senior Citizen, if no premium is paid on health insurance coverage
              • For Self/ Spouse or Dependent Children  Deduction limit of ₹ 50,000
              • For Parents  Deduction limit of ₹ 50,000

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                • 6. 8DD Deduction towards payments made towards Maintenance or Medical treatment of a Disabled Dependent or Paid / Deposited any amount under relevant approved scheme
                • Flat deduction of ₹ 75,000 available for a person with Disability, irrespective of expense incurred
                • The deduction is ₹ 1,25,000 if the person has Severe Disability (80% or more).

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                  • 7. 80DD(1B) Deduction towards payments made towards Medical treatment of Self or Dependant for specified disease 
                  • Deduction limit of ₹ 40,000 (₹ 1,00,000 if Senior Citizen)

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                    • 8  80E  Deduction towards interest payments made on loan for higher education of Self or relative 
                    •  Total amount paid towards interest on loan taken

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                      • 9. 80EE Deduction towards interest payments made on loan taken for acquisition of residential house property where the loan is sanctioned between 1st April 2016 to 31st March 2017
                      • Deduction limit of ₹ 50,000 on the interest paid on loan taken

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                        • 9A 80EEA Deduction towards interest payments made on loan taken for acquisition of residential house property for the first time where the loan is sanctioned between 1st April 2019 to 31st March 2022 & deduction should not have been claimed u/s 80EE
                        • Deduction limit of ₹ 1,50,000 on the interest paid on loan taken
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                          • 9B  80EEB Deduction towards interest payments made on loan for purchase of Electric Vehicle where the loan is sanctioned between 1st April 2019 to 31st March 2023
                          • Deduction limit of ₹ 1,50,000 on the interest paid on loan taken

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                            • 10. 80G Deduction towards Donations made to certain Funds, Charitable Institutions, etc.
                            • Donation are eligible for deduction under the below categories
                            • Without any limit 100% deduction 50% deduction
                            • Subject to qualifying limit 100% deduction 50% deduction
                          Note: No deduction shall be allowed under this section in respect of donation made in cash exceeding ₹ 2000/-

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                              • 11. 80GG Deduction towards rent paid for house & applicable only for whom HRA is not part of Salary
                              • Least of the following 3 shall be allowed as deduction
                              • 1. Rent paid reduced by 10% of Total Income before this deduction
                              •  2.₹ 5,000 per month 
                              • 3. 25% of Total Income before this deduction
                            Note: Form 10BA to be filled for claiming this deduction.

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                                • 12. 80GGA Deduction towards Donations made for Scientific Research or Rural Development
                                • Donation are eligible for deduction under the below categories 
                                • Research Association or University, College or other Institution for Scientific Research
                                • Social Science or Statistical Research
                                • Association or Institution for Rural Development 
                                • Conservation of Natural Resources or for Afforestation
                                • PSU or Local Authority or an association or institution approved by the National Committee for carrying out any eligible project
                              Funds notified by Central Government for Afforestation Rural Development National Urban Poverty Eradication Fund as setup and notified by Central Government

                              Note: No deduction shall be allowed under this Section in respect of donation made in cash exceeding ₹ 2000/- or if Gross Total Income includes income from Profit / Gains of Business / Profession

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                                  • 13. 80GGC Deduction towards Donations made to Political Party or Electoral Trust
                                  • Deduction towards Donations made to Political Party or Electoral Trust

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                                    • 14. 80TTA Deduction on interest received on saving bank accounts by Non-Senior Citizens
                                    • Deduction limit of ₹ 10,000/-

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                                      • 15. 80TTB Deduction on interest received on deposits by Resident Senior Citizens 
                                      • Deduction limit of ₹ 50,000/-

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                                        • 16. 80U  Deductions for an individual taxpayer with Disability
                                        • Flat ₹ 75,000 deduction for a person with Disability, irrespective of expense incurred
                                        • Flat ₹ 1,25,000 deduction for a person with Severe Disability (80% or more), irrespective of expense incurred

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