Section 80C

Deduction in respect of life insurance premia, deferred annuity, contributions to provident fund, subscription to certain equity shares or debentures, etc.

It provides for a deduction of savings in specified modes of Investments form gross total income(as mentioned below).

It is available only to an Individual or HUF. The Maximum permissible deduction is Rs.1.5 lakh along with deduction u/s 80CCC & 80CCD.

Following are the modes of Investments:

  1. Life insurance premium for policy:
    • in case of individual, on life of assessee, assessee’s spouse and any child of assessee
    • in case of HUF, on life of any member of the HUF
  2. Sum paid under a contract for a deferred annuity:
    • in case of individual, on life of the individual, individual’s spouse and any child of the individual (however, contract should not contain an option to receive cash payment in lieu of annuity)
    • in case of HUF, on life of any member of the HUF
  3. Tuition fees (excluding development fees, donations, etc.) paid by an individual to any university, college, school or other educational institution situated in India, for full time education of any 2 of his/her children
  4. Contributions by an individual made under Employees’ Provident Fund Scheme
  5. Contribution to Public Provident Fund Account in the name of:
    • in case of individual, such individual or his spouse or any child of such individual
    • in case of HUF, in the name of any member there of
  6. Contribution by an employee to a recognized provident fund
  7. Contribution by an employee to an approved superannuation fund
  8. Subscription to any notified security or notified deposit scheme of the Central Government (Any sum deposited during the year in Sukanya Samriddhi Account by an individual would be eligible for deduction.)
  9. Certain payments(Housing loan Principal Amount & Stamp duty charges) for purchase/construction of residential house property.
  10. Subscription to notified savings certificates [National Savings Certificates (VIII Issue)]
  11. Contribution for participation in unit-linked Insurance Plan of UTI:
    • in case of an individual, in the name of the individual, his spouse or any child of such individual
    • in case of a HUF, in the name of any member thereof
  12. Contribution to notified unit-linked insurance plan of LIC Mutual Fund:
    • in the case of an individual, in the name of the individual, his spouse or any child of such individual
    • in the case of a HUF, in the name of any member thereof
  13. 5-year term deposit in an account under the Post Office Time Deposit Rules, 1981 (subject to certain conditions)
  14. Subscription to notified deposit scheme or notified pension fund set up by National Housing Bank [Home Loan Account Scheme/National Housing Banks (Tax Saving) Term Deposit Scheme, 2008]
  15. Sum deducted from salary payable to Government servant for securing deferred annuity or making provision for his wife/children [qualifying amount limited to 20% of salary]
  16. Sum paid towards notified annuity plan of LIC or other insurer
  17. Subscription to any units of any notified [u/s 10(23D)] Mutual Fund or the UTI (Equity Linked Saving Scheme, 2005)
  18. Contribution by an individual to any pension fund set up by any mutual fund which is referred to in section 10(23D) or by the UTI (UTI Retirement Benefit Pension Fund)
  19. Subscription to equity shares or debentures forming part of any approved eligible issue of capital made by a public company or public financial institutions
  20. Subscription to any units of any approved mutual fund referred to in section 10(23D), provided amount of subscription to such units is subscribed only in ‘eligible issue of capital’ referred to above.
  21. Subscription to notified schemes of (a) public sector companies engaged in providing long-term finance for purchase/construction of houses in India for residential purposes/(b) authority constituted under any law for satisfying need for housing accommodation or for planning, development or improvement of cities, towns and villages, or for both
  22. Term deposits for a fixed period of not less than 5 years with a scheduled bank, and which is in accordance with a scheme framed and notified.
  23. Subscription to notified bonds issued by the NABARD.
  24. Deposit in an account under the Senior Citizen Savings Scheme Rules, 2004 (subject to certain conditions)