80C Deduction ay 2018-19 (Section 80C FY 2017-18)

Section 80C Deduction for AY 2018-19 (FY 2017-18) is Rs.1,50,000: Section 80C lists down vairous options where an Individual can invest and claim exemption from income. For ay 2018-19, the deduction under section 80C is limited at Rs.1,50,000. The deduction under section 80C is allowed from your Gross Total Income. The deduction is allowed for various investments, expenses and payments.  Section 80C Deduction for ay 2018-19 (FY 2017-18) is allowed to Individuals as well as Hindu Undivided Family business.

Details of 80C Deduction for ay 2018-19 (FY 2017-18)

80C Deduction Max Allowable Rs.1,50,000
80C Deduction Includes LIC Yes
Children Education Depends

Life Insurance Premiums : Section 80C Deduction

Life insurance premium on life of himself, spouse and children or paid by an HUF for any member of his family. Insurance premium is deductible subject to maximum ceiling given below.

Provident Fund, Public Provident Fund and other superannuation funds : Section 80C Deduction

Contributing to recognized superannuation fund like Provident fund, Public provident fund and Mutual funds are eligible for deductions under section 80C.

Usually the employer invests in such superannuation funds by deducting the investment amount from salary. ELSS constitute a type of Mutual fund which are sold with a lock in period of 3 years and returns obtained from the ELSS scheme are tax free.

Any premium paid towards any annuity plan, whether deferred or immediate will give tax relief in that financial year.

Investments in Infrastructure public Company : Section 80C Deduction

Amount invested in deposit scheme of public company engaged in infrastructure facility or approved mutual fund.

Bank Fixed Deposits : Section 80C Deduction

Bank fixed deposits which are deductible under section 80C are regular fixed deposits with interest being compounded quarterly with a lock in period of 5 years.

National Savings Certificates (NSCs) : Section 80C Deduction

Investments in National Savings Certificate are also deductible under this section and these investments are available from the Indian postal services or post offices.

Deposits in various types of accounts : Section 80C Deduction

Any sum deposited in an account under the senior citizen Saving scheme, sum deposited as 5 years time deposit in an account under the post office time deposit, sum deposited in Sukanya Samriddi Account are all eligible for deduction under this section.

Tuition fee : Section 80C Deduction

An Individual can claim deductions on children’s tuition fees only for two children and that too for the educational institutions situated in India only.

  1. Subscriptions to notified bonds of NABARD
  2. Unit Linked Insurance Plans
  3. Repayment of principal amount of loan taken for purchase/construction of house property

The deduction with respect to Home loan repayment can be claimed only if the loan has been taken from specified financial institutions or entities like your employer a public limited company, central or state government, or board, corporation, university established by law.

In Computing the total income of an individual or Hindu Undivided family, the above contributions, expenses and investments shall be made available for deduction u/s 80c of the Income Tax Act 1961 capped up to Rs. 1,50,000/- . The legislator’s intention behind the section 80C is to boost investments and savings among the Tax Payers.

Conclusion : 80C Deduction ay 2018-19

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