All about income tax deductions in India 2022-2023

As per the Income Tax Act of 1961, there are certain deductions allowed that allow individuals to save taxes. These deductions are termed income tax deductions and help a lot in reducing tax liabilities. These deductions can be claimed if you purchased any investment plan, sought medical treatment, contributed towards PPF, charitable income, or something similar. Such deductions are also allowed to encourage individuals to invest as well as contribute to a social cause. However, the limit of tax deductions varies from individual to individual and depends on several factors like income, age, filling status, and a few more.

Listed below are the different sections that are covered under the Income Tax deductions in India:

• Section 80 C

Under section 80C, individuals can get tax deductions on investment plans. The available investment plans that allow tax deductions are ELSS, Bank fixed deposits, ULIP, PPF, Life insurance plans, and more. According to the Income Tax Act of 1961, individuals can get a maximum deduction of Rs. 1,50,000 under section 80C.

• Section 80CCC

This section allows deductions on premiums paid toward annuity pension plans. However, the annuity earned out of these annuity plans is taxable and the maximum deductions applicable is Rs. 1,50,000 lakhs.

• Section 80CCD

Any contribution made towards pension schemes such as National Pension Scheme or NPS, Atal Pension Scheme, qualifies for tax deductions under this section.

• Section 80CCF

If you are putting your money into long term infrastructure bonds, then a maximum tax deduction of Rs. 20,000 can be claimed.

• Section 80CCG

Another sub-section of section 80C, section 80CCG allows deductions if contributions are made towards Rajiv Gandhi Equity Savings Scheme or RGESS. The maximum deductions allowed is Rs. 50,000.

• Section 80D

Section 80D allows tax deductions on health insurance premiums in case an individual has bought a health insurance plan for his/her family or dependents. Depending on whom you are buying the health insurance plan for, the maximum deduction will vary. For instance, if you are buying a health insurance plan for your spouse, then the deduction allowed is up to Rs. 15,000. On the other hand for senior citizens, it is up to Rs. 20,000.

• Section 80DD

This allows deductions on health insurance plans for senior citizens. In case the disability is severe, then the maximum deduction applicable is Rs. 1,50,000 and for moderate disability, there is a deduction of up to Rs. 75,000.

• Section 80 DDB

This allows deductions if any individual is seeking medical treatment for self or family. A maximum deduction on medical expenses goes up to Rs. 60,000.

• Section 80E

The benefits offered under this section are extremely beneficial for those spending a certain amount of money on the education of their dependents or themselves. So, if you have taken educational loans, then you can enjoy tax benefits under this section.

• Section 80G

The contributions made towards social welfare benefits allow tax deductions under section 80G, provided that proper receipts are submitted for the same. Please note that there are 100% deductions if contributions are made towards the Prime Minister’s Relief Fund, National Illness Assistance Fund, and more. Section 80G is further classified into 80GGC, 80GGB, 88GG, and 80GG, based on the eligibility of individuals.

• Section 80GGB

Section 80GGB allows tax deductions if contributions are made by any company towards political parties or even electoral trusts. However, the political party must be a registered one, otherwise, there are eligible tax deductions.

• Section 80GGC

The section 80GGC is almost similar to section 80GGB, however, the only difference is that the contributions, in this case, are made by an individual towards a registered political party.

• Section 80GG

Under the section 80GG, both salaried and self-employed individuals can get tax deductions in case they have paid any amount as rent towards any furnished or unfurnished residence. This can be claimed by those who do not receive a house rent allowance from their employer.

• Section 80 TTB

Section 80 TTB allows deductions on interests earned on bank deposits, post offices, etc, however, this is applicable only to senior citizens.

• Section 80U

Under section 80U, disabled individuals can get tax deductions. However, you need to have a valid certificate that specifies your medical condition, only then will you get tax deductions under this section.