Section 80C is the most used tax-saving section amongst the tax-payers. Section 80C provides for investment options whenever one wants to reduce his/her tax liability. Be it life insurance premiums, PPF contributions, five-year term deposits or ELSS schemes, the list of tax-free instruments under this section is quite long. But there is a catch. You cannot claim more than ₹1.5 lakhs exemption in aggregate through Section 80C investments. If you add NPS investments (Section 80CCD), you can claim an additional ₹50,000, bringing the total available deduction to ₹2 lakhs. Is the ₹2 lakhs exemption sufficient? What if you can get more?
Yes, there are other sections which give you additional tax-saving exemptions besides Section 80C. While many are available under Section 80 itself, some belong to other sections.
Let us see what they are –
Here is a complete list of tax-free deductions available under Section 80 apart from Section 80C:
|Sections||What they deal in||Exemption limit|
|80D||Health insurance premiums||Up to ₹60,000
( Premium paid for health insurance for self-spouse-child- ₹25,000
Senior citizen parents or self –₹30,000)
|80DD||Expenses on a handicapped dependent||Disability up to 80% - ₹75,000 (fixed)
Severe disabilities – ₹1.25 lakhs (fixed)
|80DDB||Treatment of specified illnesses||Age up to 60 years – up to ₹40,000
Age 60-80 years – up to ₹60,000
Age above 80 years – up to ₹80,000
|80E||Education loan interest payment||Nil. Actual interest paid|
|80EE||Home loan interest payment for first time home-owners||Up to ₹50,000|
|80G||Donations to approved charitable institutes||50% or 100% of the amount donated|
|80GG||Rent paid by employees not having HRA||Lower of the following –
· 25% of total income
· Rent paid exceeding 10% of total income
|80GGB and 80GGC||Contributions made to a political party by companies and individuals respectively||Nil. 100% actual contribution made only by other than cash.|
|80TTA||Saving account interest||₹10,000|
|80U||Handicapped tax-payers can claim this deduction||₹75,000 (fixed). For severe disabilities ₹1.25 lakhs (fixed)|
|80RRB||Royalty or patent income||Up to ₹3 lakhs|
If you have a home loan, you can earn tax exemption on its interest payment too. Interest of up to ₹2 lakhs is allowed as tax-free expense under the provisions of Section 24(b).
If you are a salaried employee then you can enjoy the tax-saving benefits of House Rent Allowance, which might be a component of your salary. If you are living in a rented home you can claim HRA exemption from your salary income. The maximum exemption which is available is lower of the following -
Besides the all-too-popular HRA exemption, you can also avail tax exemption on Leave Travel Allowance, meal coupons, conveyance allowance, medical allowance, etc.
Money received by way of gift is also tax-free. If you receive gifts from your direct relatives, there is no upper limit on exemption. From non-relatives, however, gifts up to ₹50,000 are tax-free. If you receive cash gifts on the event of marriage, they are completely tax-free without any limit and irrespective of the person giving the gift. Money received through will is also tax-free in your hands.
Do not depend entirely on Section 80C to reduce your tax liability. Though Section 80C does offer a major tax-saving deduction, there are other sections that one can explore. So, use the above-mentioned sections of the Income Tax Act and save your tax outgo.