Income Tax Sections and Income Tax Return services in India|ITR forms and e-filing income tax returns in India

Section Deductions

Section Deductions

Section Nature of deduction Who can claim

80CCC

Contributions to certain pension funds of LIC or any other insurer (up to Rs. 1,50,000) (subject to certain conditions)

Individual

80C

Deductions for Life Insurance Premium, Provident Fund etc.

The deduction is allowed only when the amount has actually been paid by the assessee.

Following amounts paid or deposited are allowed as deduction u/s 80C:

  • Any sum paid by an individual as Life insurance premium on life of himself, spouse and children or paid by an HUF for any member of his family. However premium paid in excess of 20% of the capital sum assured shall be ignored.
  • Contribution to statutory provident fund or recognized provident fund
  • Contribution to superannuation fund
  • Contribution/subscription to PPF, NSC, NSS, ULIP, ELSS,
  • Fixed Deposit with any schedule bank for at least 5 years
  • Subscription to notified bonds of NABARD
  • Payment of tuition fees (excluding development fees or donation etc) for maximum two children for full time education to university, college, school or other educational institution situated in India.
  • Repayment of principal amount of loan taken for purchase/construction of residential house property from Central/State Govt, Bank, LIC, National Housing Bank or from employer( where employer is statutory corporation, public company, university, college, or local authority or co-operative society)
  • Payment of stamp duty for the purpose of transfer of residential house property to the assessee.
  • Amount invested in deposit scheme of public company engaged in infrastructure facility or approved mutual fund.
  • Any sum deposited in an account under the Senior Citizens Saving Scheme.
  • Any sum deposited as five years time deposit in an account under the Post Office Time Deposit.

            Individual/HUF

80CCD

Contribution to Pension Scheme of Central Government

Deduction is allowed for contribution made by individual (whether salaried or self-employed) towards notified pension scheme, but maximum up to a limit of 10% of Salary or Gross Total Income as the case may be.

Employee is also allowed deduction of the amount which is contributed by the employer but up to a maximum limit of 10% of employee salary . (Salary includes Basic Pay and Dearness Allowance, if it forms part of retirement benefit).

Amount received from such pension fund is taxable at the time of receipt.

Contribution made by employer shall also be allowed as deduction under section 80CCD(2) while computing total income of the employee. However, amount of deduction could not exceed 10% of salary of the employee

 

Individual

80CCF

Amount up to Rs. 20,000, paid or deposited, during the previous years relevant to assessment year 2011-12 or 2012-13, as subscription to notified long-term infrastructure bonds

Individual/HUF

80CCG

50 per cent of amount invested by specified resident individuals in notified equity savings scheme (subject to certain conditions and limits) (maximum deduction : Rs. 25,000)

Specified resident individuals (new retail investors)

80D

Amount paid (in any mode other than cash) by an individual or HUF to LIC or other insurer to effect or keep in force an insurance on the health of specified person. An individual can also make payment to the Central Government health scheme and/or on account of preventive health check-up (subject to limit)

 ?  specified person means:

-   In case of Individual - self, spouse, dependent children or parents

-   In case of HUF - Any member thereof

?  Deduction for preventive health check-up shall not exceed in aggregate Rs. 5,000.

?  Payment on account of preventive health check-up may be made in cash

            Individual/HUF

80DD

Deduction of Rs. 75,000 (Rs. 1,25,000 in case of severe disability) to a resident individual/HUF where (a) any expenditure has been incurred for the medical treatment (including nursing), training and rehabilitation of a dependant, being a person with disability [as defined under Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995] (w.e.f. assessment year 2005-06 including autism, cerebral palsy and multiple disability as referred to in National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation & Multiple Disabilities Act, 1999), or (b) any amount is paid or deposited under an approved scheme framed in this behalf by the LIC or any other insurer or the Administrator or the specified company for the maintenance of a dependent, being a person with disability (subject to certain conditions)

Resident Individual/HUF

80DDB

Expenses actually paid for medical treatment of specified diseases and ailments.

Deduction is allowed to a resident individual/HUF for payment towards Medical treatment of specified disease of self or dependent relative or member of HUF.

Deduction is allowed for the amount actually spent or Rs. 40000 (Rs. 60000 in case of senior citizen), whichever is less.

Deduction shall be reduced by the amount received from the insurer or employer. Further, a certificate from doctor of government hospital has to be furnished for claiming the deduction.

Resident Individual/HUF

80E

Amount paid out of income chargeable to tax by way of payment of interest on loan taken from financial institution/approved charitable institution for pursuing higher education (subject to certain conditions)                                       (maximum period 8 yr)

Individual

80EE

Interest payable on loan taken by him from any financial institution for the purpose of acquisition of a residential house property (Maximum deduction : Rs. 3,00,000)

Individual

80G

Deduction is allowed to all assessee for payments made to specified funds/ institutions

Donation shall be sum of money; Donation in kind is not deductible. Further proof of payment shall be furnished with the return

Part A: Donations made to following are eligible for 100% deduction without any qualifying limit:

  • National Defence Fund set up by the Central Government
  • Prime Minister’s National Relief Fund
  • Prime Minister’s Armenia Earthquake Relief Fund
  • Africa (Public Contributions - India) Fund
  • National Foundation for Communal Harmony
  • a University or any educational institution of national eminence as may be approved by the prescribed authority
  • Chief Minister’s Earthquake Relief Fund, Maharashtra
  • any fund set up by the State Government of Gujarat exclusively for providing relief to the victims of earthquake in Gujarat
  • Zila Saksharta Samiti constituted in any district
  • National Blood Transfusion Council
  • any fund set up by a State Government to provide medical relief to the poor
  • Army Central Welfare Fund or the Indian Naval Benevolent Fund or the Air Force Central Welfare Fund
  • Andhra Pradesh Chief Minister’s Cyclone Relief Fund
  • National Illness Assistance Fund
  • Chief Minister’s Relief Fund or the Lieutenant Governor’s Relief Fund
  • National Sports Fund set up by the Central Government
  • National Cultural Fund set up by the Central Government
  • Fund for Technology Development and Application set up by the Central Government National
  • Trust for Welfare of Persons with mental retardation and multiple disabilities.

 

Part B: Donations made to following are eligible for 50% deduction without any qualifying limit

  • Jawaharlal Nehru memorial fund
  • Prime Minister’s Drought Relief Fund
  • National Children’s Fund
  • Indira Gandhi Memorial Trust
  • Rajiv Gandhi Foundation

 

Part C: Donations made to following are eligible for 100% deduction subject to qualifying limit:

  • Donation to Government or any approved local authority, institution or association to be utilized for promoting family planning Prime Minister’s Drought Relief Fund
  • Donation made by a company to Indian Olympic Association or to any other notified institution, for development of infrastructure for sports in India

 

Part D: Donations made to following are eligible for 50% deduction subject to qualifying limit:

  • Donation to Government or any approved local authority, institution or association to be utilized for any other charitable purpose other than promoting family planning
  • Donation to any approved charitable institution which satisfies the condition of Section 80G.
  • Donation to any authority for satisfying the need for housing accommodation or any corporation for promoting interest of minority community.
  • Donation to any notified temple, mosque, gurudwara, church or other place notified by the Central Government to be of historical, archaeological or artistic importance for renovation or repair of such place.

Donations under Part C and Part D above shall not exceed the qualifying limit.

Qualifying limit means 10% of adjusted Gross Total Income.

 

Adjusted Gross Total Income means:

Gross Total Income

Less: Long Term Capital Gains

Less: Short Term Capital Gains u/s 111A

Less: Deductions u/s 80C to 80U (Except 80G)

All assessees

80GG

Rent paid in excess of 10% of total income for furnished/unfurnished resi-dential accommodation (subject to maximum of Rs. 2,000 p.m. or 25% of total income, whichever is less) (subject to certain conditions)

Individuals not receiving any house rent allowance

80GGA

Certain donations for scientific, social or statistical research or rural development programme or for carrying out an eligible project or scheme or National Urban Poverty Eradication Fund (subject to certain conditions)

All assessees not having any income chargeable under the head 'Profits and gains of business or profession'

80GGB

Sum contributed to any political party/electoral trust. Any sum contributed by Indian Company to political party or electoral trust is allowed as deduction.

Indian company

80GGC

Sum contributed to any political party/electoral trust.

Any sum contributed by any person (except local authority or artificial juridical person) to political party or electoral trust is allowed as deduction.

All assessees, other than local authority and artificial juridical person wholly or partly funded by Government

 

For certain incomes

 

80-IA

Profits and gains from industrial undertakings engaged in infrastructure facility, telecommunication services, industrial park, development of Special Economic Zone, power undertakings, etc. (subject to certain conditions and limits)

All assessees

80-IAB

Profits and gains derived by undertaking/enterprise from business of developing a Special Economic Zone notified on or after 1-4-2005 (subject to certain conditions and limits)

Assessee being Developer of SEZ

80-IB

Profits and gains from industrial undertakings, cold storage plant, hotel, scientific research & development, mineral oil concern, housing projects, cold chain facility, multiplex theatres, convention centres, ships, etc. (subject to certain conditions and limits)

All assessees

80-IC

Profits and gains derived by an undertaking or an enterprise in special category States (Himachal Pradesh, Uttaranchal, Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura) (subject to certain limits, time limits and conditions),

(a) which has begun or begins to manufacture or produce any article or thing, not being any article or thing specified in the Thirteenth Schedule, or which manufactures or produces any article or thing, not being any article or thing specified in the Thirteenth Schedule and undertakes substantial expansion during the specified period.

(b) which has begun or begins to manufacture or produce any article or thing specified in the Fourteenth Schedule or commences any operation specified in that Schedule, or which manufactures or produces any article or thing, specified in the Fourteenth Schedule or commences any operation specified in that Schedule and undertakes substantial expansion during the specified period

All assessees

80-ID

Profits and gains from business of hotels and convention centres in specified areas (subject to certain conditions).

All assessees

80-IE

Deduction in respect of certain undertakings in North Eastern States.

All assessees

80JJA

Deduction in respect of profits and gains from business of collecting and processing of bio-degradable waste

Deduction is allowed to all assessee who are engaged in the business of collecting/ processing or treating etc of bio-degradable waste for generating power or to make pellets for fuel or to use it in organic manure or to use it in bio-gas plant etc.

Deduction is allowed equal to 100% profits of such business for the 5 consecutive assessment years beginning with the year in which such business is commenced.

All assessees

80JJAA

Deduction in respect of employment of new workmen

Deduction is allowed to Indian Company , equal to 30% wages of the new regular workman for 3 assessment years including the year in which the employment is provided.

Companies shall be engaged in the manufacture or production of any article or thing and accounts must be audited by Chartered Accountant and the report shall be furnished with the return of income.

Wages qualifying for deduction:

  1. In the case of new company – wages paid to workers in excess of 100
  2. In the case of existing company – wages paid to workers in excess of 100, but there should be at least 10% increase in number of workers, as employed on the last day of the preceding year.

Regular Workmen does not include:

  1. Person employed in managerial or administrative capacity or
  2. Workman employed as a casual workman or contract labour or
  3. Any other workman employed for a period of less than 300 days during the previous year

Indian company having profits and gains derived from manufacture of goods in a factory

80LA

Certain incomes of Scheduled banks/banks incorporated outside India having Offshore Banking Units in a Special Economic Zone/Units of International Financial Services Centre

Deduction is allowed to:

  1. A scheduled bank having an offshore banking unit in SEZ or
  2. Any bank , incorporated under the laws of a foreign country and having an offshore banking unit in SEZ or
  3. A unit of International Financial Services Centre (IFSC)

Quantum of deduction:

  1. For the first 5 consecutive years: 100% of such income beginning with the previous year in which
    • the permission under the Banking Regulation Act was obtained or
    • the permission under the SEBI Act, 1992 was obtained or
    • permission or registration under any relevant law was obtained
  2. For the next 5 years : 50% of such income

Conditions to be satisfied:

  1. A report of Chartered Accountant, certifying that the deduction has been correctly claimed, should be submitted with return of income
  2. Copy of permission obtained under the Banking Regulation Act, 1949 should be furnished along with the return of Income.

Scheduled Banks/banks incorporated outside India/Units of International Financial Services Centre

80P

Specified Income from following activities shall be allowed 100% deduction in case of co-operative societies:

  1. Income from business of banking or providing credit facilities to its members
  2. Income from cottage industry
  3. Income from marketing of the agricultural produce grown by its members
  4. Income derived from the purchase of agricultural implements, seeds, livestock or other articles intended for agriculture
  5. Income from processing without the aid of power
  6. Income from fishing or allied services
  7. Income from supplying milk , oilseeds, fruits & vegetables raised by its members to federal milk co-operative society

Co-operative societies engaged in a business other than those mentioned above shall not be liable to pay tax on.

Co-operative societies

80QQB

Royalty income of author of certain specified category of books (up to Rs. 3,00,000)

  1. Books should be a work of literary, artistic or scientific nature. Books shall not include text books, diaries, commentaries, journals etc.
  2. Royalty in excess of 15% of the value of the books sold during the previous year shall be ignored. However, this condition is not applicable where the royalty is received in lumpsum.
  3. If royalty is received from outside India, then to claim deduction, it must be brought into India within 6 months from the end of the previous year in which such income is earned.

Resident Individual - Author

80RRB

Royalty on patents up to Rs. 3,00,000 in the case of a resident individual who is a patentee and is in receipt of income by way of royalty in respect of a patent registered on or after 1-4-2003

 

If royalty is received from outside India, then to claim deduction, it must be brought into India within 6 months from the end of the previous year in which such income is earned.

Resident individuals

80TTA

Interest on deposits in savings bank accounts (up to Rs. 10,000 per year)

Individuals/HUFs

80U

Deduction of Rs. 75,000 to a resident individual who, at any time during the previous year, is certified by the medical authority to be a person with disability [as defined under Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995] [w.e.f. assessment year 2005-06 including autism, cerebral palsy, and multiple disabilities as defined under National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation & Multiple Disabilities Act, 1999] [in the case of a person with severe disability, allowable deduction is Rs. 1,25,000] (subject to certain conditions).

Resident individuals

 

Rebates

 

87A

Tax rebate in case of individual resident in India, whose total income does not exceed five hundred thousand rupees; quantum of rebate shall be an amount equal to hundred per cent of such income-tax or an amount of two thousand rupees, whichever is less.

Individual