Chapter VI-A of the Income Tax Act, 1961, provides various deductions from Gross Total Income (GTI) to arrive at Total Income. These deductions are categorized under Section 80A to 80U and are available to individuals, HUFs, and other eligible taxpayers based on specific investments, expenditures, or incomes.
Key Deductions Under Chapter VI-A
1. General Provisions (Section 80A)
- Governs the overall applicability of deductions under Chapter VI-A.
- The aggregate deduction cannot exceed Gross Total Income (GTI).
- Deductions are available only if the taxpayer furnishes proof (investment proofs, certificates, etc.).
2. Common Deductions
A. Savings & Investments
- Section 80C– Deduction up to ₹1.5 Lakh for:
- Life Insurance Premium (LIC, etc.)
- ELSS (Equity-Linked Savings Scheme)
- PPF (Public Provident Fund)
- NSC (National Savings Certificate)
- 5-year FD in banks/post office
- Tuition fees (for 2 children)
- Home Loan Principal Repayment
- Sukanya Samriddhi Yojana (SSY)
- Section 80CCC– Pension Funds (up to ₹1.5 Lakh, included in 80C limit).
- Section 80CCD(1)– NPS (National Pension System) contribution by employee (up to 10% of salary, max ₹1.5 Lakh).
- Section 80CCD(1B)– Additional ₹50,000 deduction for NPS (exclusive of 80C limit).
- Section 80CCD(2)– Employer’s contribution to NPS (up to 10% of salary, no upper limit).
B. Medical & Health
- Section 80D– Health Insurance Premium:
- Self/Family: ₹25,000 (₹50,000 for senior citizens).
- Parents: ₹25,000 (₹50,000 if senior).
- Preventive Health Check-up: ₹5,000 (included in the limit).
- Max deduction: ₹1 Lakh (if both self & parents are covered).
- Section 80DD– Disability (Dependent with 40%+ disability):
- ₹75,000 (for normal disability).
- ₹1.25 Lakh (for severe disability, 80%+).
- Section 80DDB– Medical Treatment for Specified Diseases:
- ₹40,000 (₹1 Lakh for senior citizens).
C. Interest Payments
- Section 80E– Interest on Education Loan (No upper limit, for 8 years).
- Section 80EEA– Interest on Home Loan (Affordable Housing, ₹1.5 Lakh extra, if stamp duty ≤ ₹45 Lakh).
- Section 80EEB– Interest on Electric Vehicle Loan (₹1.5 Lakh).
D. Donations
- Section 80G– Donations to Charitable Institutions:
- 100% deduction(e.g., PM Relief Fund, National Defence Fund).
- 50% deduction(e.g., NGOs, religious trusts).
- Section 80GGA– Donations for Scientific Research/Rural Development.
E. Other Deductions
- Section 80GG– Rent Paid (if HRA not received, least of: 25% of income, ₹5,000/month, or rent paid – 10% of income).
- Section 80TTA– Interest on Savings Account (₹10,000 max).
- Section 80TTB– Interest Income for Senior Citizens (₹50,000 max on FDs, RDs, etc.).
- Section 80U– Disability for Self (₹75,000 or ₹1.25 Lakh for severe disability).
Conditions & Limitations
- Deductions are not refundable(cannot create a loss).
- Must be claimed in the relevant financial year.
- Proof (investment receipts, insurance premium receipts, etc.) must be submitted.
