Thursday, July 18, 2013

Income Tax - Section 80C

Section 80C of the Income Tax Act allows certain investments and expenditure to be deducted from total income up to the maximum of Rs 1,00,000.
  • Contribution to approved superannuation fund/public provident fund/recognized provident fund/statutory provident fund. Provident fund contribution should not exceed 1/5th of salary & public provident fund.
  • Payment of life insurance premium. It is allowed on premium paid on self, spouse and children even if they are not dependent on father or mother subject to a maximum of 20% of sum assured.
  • Payment in respect of non-commutable deferred annuity.
  • Unit linked Insurance policy of UTI/LIC.
  • Subscriptions to National Savings Certificates VIII issues.
  • Deposits with National Housing Bank.
  • Principal part of loan taken for acquiring Residential House Property; provided that the house should not be transferred within 5 years. Loan for land cost for residential house is also qualified.
  • Subscriptions to schemes of PSU's providing long term finance for housing, or of housing boards constituted in India for infrastructural development of cities/towns.
  • Notified annuity plan of LIC or of any other approved insurer.
  • Units of Mutual Fund or UTI.
  • Notified pension fund by UTI or approved mutual fund.
  • Tuition fees (not including donation or development fees) towards full-time education including play-school activities, pre-nursery & nursery classes, of any 2 children of an individual, paid to University, College or School in India.
  • Investments in shares or debentures with a lock-in-period of 3 years, of approved public company exclusively engaged in infrastructure facility or power sector.
  • Subscription to the bonds issued by NABARD as specified by Central Government.
  • Any sum deposited as 5 years time deposit under Post Office Term Deposit.
  • Any sum deposited in Senior Citizen Savings Scheme.
  • Any sum deducted from salary of Government employee (subject to maximum 20% of salary) towards deferred annuity plan for benefit of self, spouse or any children.
  • Term deposit with scheduled bank for a period of not less than 5 years as per scheme notified by Central Government.
  • Investing in units of notified mutual fund investing in approved public companies engaged in infrastructure facility or power sector.

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