Income Tax Deductions List - Deductions on Section 80C to 80U FY 2025-26 (AY 2026-27)

Q: Is there any restriction or maximum limit up to which I can claim a tax deduction under Section 80E?

Yes, under Section 80E, there is a restriction on the maximum amount you can claim as a tax deduction. However, the entire interest paid on the education loan is deductible without any upper limit. Please note that the deduction only applies to the loan’s interest component, not the principal amount.

Q: Are the tax exemptions available under Section 80D available to corporates?

No, the tax exemptions available under Section 80D are not available to corporations. Section 80D provides deductions for medical insurance premiums paid by individual taxpayers for themselves, their spouses, children, and parents. It benefits individual taxpayers and Hindu Undivided Families (HUFs) and does not apply to companies or firms.

Q: What are the tax exemptions available under Section 80DD?

Section 80DD provides tax exemptions to individual taxpayers and HUFs who incur expenses for the maintenance, medical treatment, and rehabilitation of a dependent with a disability. The deduction amount is up to ₹75,000 and can go up to ₹1,25,000 in case of severe disabilities. The disability must be at least 40% certified by a competent medical authority.

Q: Are all allowances taxable for salaried individuals?

No, all allowances are not taxable for salaried individuals. Some allowances are fully taxable, while others are partially or fully exempt from tax. For example, the House Rent Allowance (HRA) can be partially exempt if certain conditions are met. Similarly, the Leave Travel Allowance (LTA) and certain allowances for specific purposes may also be exempted up to prescribed limits.

Key income tax deductions are available under Sections 80C to 80U as per Chapter VIA for FY 2025-26 (AY 2026-27). There are various tax-saving options, including investments, insurance, medical expenses, home loans, and education costs that you can claim as deductions. By leveraging the income tax deduction list, you can reduce your taxable income and maximize savings. Whether you are a salaried individual or a business owner, this article helps you make informed tax-planning decisions.

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What are Income Tax Deductions?

An income tax deduction is the amount you can exclude from your total income before calculating your tax liability. These deductions are listed as part of Chapter VI-A of the Income Tax Act under Sections 80C to 80U. They help reduce your taxable income, which means you pay less tax.

The government allows these deductions to encourage people to save, invest, or spend on essential things like healthcare, education, and housing.

Income Tax Deduction under Section 80C

Section 80C is one of the most popular tax-saving provisions in India. Under this section, taxpayers can claim deductions up to ₹1.5 lakhs in a financial year. Some eligible investments and expenditures under the 80C deduction list include:

Investment Option	Average Returns	Risk	Lock-in Period
Public Provident Fund (PPF)	7.1% (varies)	Low	15 years (partial withdrawal after 5 years)
Employee Provident Fund (EPF)	8.15% (approx)	Low	Till retirement or job change (partial withdrawal allowed)
National Savings Certificate (NSC)	7.7% (fixed)	Low	5 years
Equity-Linked Savings Scheme (ELSS)	12-15% (market-linked)	High	3 years
Unit Linked Insurance Plan (ULIP)	8-12% (varies)	Medium to High	5 years
National Pension System (NPS)	9-12% (market-linked)	Medium to High	Till retirement (60 years), partial withdrawal after 3 years
Tax-saving Fixed Deposit (FD)	6-7.5% (varies)	Low	5 years
Sukanya Samriddhi Yojana (SSY)	8.2% (fixed)	Low	21 years (partial withdrawal after 18 years)
Senior Citizen Savings Scheme (SCSS)	8.2% (fixed)	Low	5 years (extendable by 3 years)

Section 80 Deduction List - Deduction Limits Under Section 80C, 80CCC, 80CCD(1), 80CCE, 80CCD(1B)

For taxpayers in India, understanding the various deductions available under Chapter VIA of the Income Tax Act, 1961, is paramount for effective tax planning for FY 2025-26 (AY 2026-27). Among these, Sections 80C, 80CCC, and 80CCD(1) are some of the most commonly utilized income tax exemption list for reducing taxable income.

Section 80C offers deductions for a wide array of investments and expenditures, such as term life insurance premiums, Public Provident Fund (PPF), Equity Linked Saving Schemes (ELSS), and home loan principal repayment.
Section 80CCC allows deductions for contributions made to certain pension funds.
Section 80CCD(1) pertains to an individual's contributions to notified pension schemes like the National Pension System (NPS) or Atal Pension Yojana (APY).

Collectively, the total deduction claimable under Sections 80C, 80CCC, and 80CCD(1) is capped by Section 80CCE. However, Section 80CCD(1B) provides an additional avenue for tax savings through NPS contributions, over and above the limit prescribed by Section 80CCE.

Here is a brief overview of the income tax deduction list:

Section	Nature of Eligible Investment for Tax Deductions	Maximum Deduction Limit
80C	Various specified investments and expenditures, including ELSS, PPF, LIC premiums, home loan principal, etc.	₹1,50,000
80CCC	Contributions to certain annuity plans for receiving a pension.	₹1,50,000
80CCD(1)	Employee's or individual's contribution to notified government pension schemes, such as NPS, APY, etc.	Employed: 10% of salary (basic + DA) Self-employed: 20% of gross total income
80CCE	Aggregate limit for deductions under Sections 80C, 80CCC, and 80CCD(1) combined.	₹1,50,000
80CCD(1B)	Additional deduction for taxpayer's contributions to the National Pension System (NPS).	₹50,000 (This is over and above the 80CCE limit)
80CCD(2)	Employer's contribution to an employee's NPS account.	Central Govt. Employer: 14% of salary (basic + DA) Other Employers: 10% of salary (basic + DA)

Income Tax Deduction under Section 80DD

A deduction of ₹75,000 in income tax may be claimed under the new tax regime exemption list for spending on medical treatments for dependents with a 40% disability.
This limit is ₹1,25,000 in case of severe disability (80% or more).
Dependents include spouse, children, parents, and siblings.
Disability must be certified by a medical authority.

Income Tax Deduction under Section 80DDB

Deduction is provided under this section for medical treatment of specified diseases for self and dependents.
It covers expenses on critical illnesses like cancer, Parkinson’s, kidney failure, etc.
Deduction of up to ₹40,000 for individuals and HUFs below 60 years.
Deduction of up to ₹1,00,000 for senior citizens and super senior citizens.

Income Tax Deduction under Section 80CCG

This section, which offered the tax benefits for investments in the Rajiv Gandhi Equity Savings Scheme, has been withdrawn.
Still, if an individual has claimed a deduction in the previous financial year, they are eligible to continue with the same for the next two financial years.

Income Tax Deduction under Section 80EE

Individuals buying a home for the first time may claim an additional deduction of ₹50,000 on the home loan interest paid.
This includes a clause that the loan should be sanctioned in or after FY 2016-17, and the loan amount should be less than ₹35,00,000.
Furthermore, the house’s value should not exceed ₹50,00,000, and the individual should not own any other residential house under his name.

Income Tax Deduction under Section 80EEA

The Indian Income Tax Act provides a tax deduction of up to ₹1.5 lakhs per financial year for interest paid on home loans taken for purchasing or constructing an affordable house.
The loan should be taken between April 1, 2019, and March 31, 2022.
House value should not exceed ₹45 lakh, and the taxpayer should not own any other house.

Income Tax Deduction under Section 80EEB

Section 80EEB of the Income Tax Act is applicable for individual taxpayers only.
It enables taxpayers to claim tax savings on interest paid for loans to purchase electric vehicles, up to ₹1.5 lakh.
Eligibility criteria, including conditions related to the loan issuer and the electric vehicle, must be met to avail of the deduction. For instance, a loan must be taken from a recognized financial institution.

Income Tax Deduction under Section 80GG

The deduction amount for this section is ₹60,000 per annum, which applies only to those who neither own a residential house nor receive a House Rent Allowance.
The amount of deduction will be the least of the following:

25% of total income.
₹5,000 per month.
Actual rent paid minus 10% of adjusted total income

Income Tax Deduction under Section 80GGC

Section 80GGC allows individuals to claim tax deductions for donations made to political parties or electoral trusts.
100% deduction is allowed, but the donation must be made through non-cash modes (cheque, digital payment, etc.).
It promotes transparency in electoral funding, encourages financial support to the political system, and helps individuals reduce their tax liability by claiming deductions against such contributions.

Income Tax Deduction under Section 80U

This section allows a deduction for individuals who are physically and mentally challenged.
Individuals with at least 40% disability (as certified by a medical authority) can claim a deduction of up to ₹75,000.
Individuals with a severe disability (at least 80% disability) can claim a deduction of up to ₹1,25,000.
You must note that while Section 80DD provides a deduction for dependents with special needs, this section applies in case the assessee themselves have a disability.

Income Tax Deduction under Section 24(B)

Section 24(B) deals with deductions on the interest paid on home loans. Loans should be taken for the purchase, construction, repair, or reconstruction of a house.
Taxpayers can claim up to ₹2 lakhs per annum for self-occupied properties.
In the case of let-out properties, there is no upper limit on claiming the interest paid on the home loan.

Income Tax Deduction under Section 80E

This section allows taxpayers to claim 100% deductions on the interest paid on education loans.
These loans must be taken for higher education, either for the taxpayer, spouse, children, or a student the taxpayer is the legal guardian of.
Though there is no upper limit, this deduction is applicable for a maximum of 8 years.

Income Tax Deduction under Section 10(14)

Section 10(14) offers deductions on various allowances salaried individuals receive, such as House Rent Allowance (HRA), conveyance allowance, and medical allowance.
The amount varies based on salary and city of residence and is subject to certain conditions.

Income Tax Deduction under Section 80G

Donations made to specified funds and charitable institutions are eligible for deductions under Section 80G.
The deduction varies from 50% to 100% of the donated amount, depending on the nature of the recipient organization.
Cash donations exceeding ₹2,000 are not eligible (must be digital/cheque).

Income Tax Deduction under Section 80TTA and 80TTB

Section 80TTA: Individuals who are below 60 years of age can claim a deduction of ₹10,000 on interest from savings accounts.
Section 80TTB: For senior citizens, a deduction of ₹50,000 is available on interest from savings, Fixed Deposits, and Recurring Deposits.
Budget 2025 has proposed to increase the limit under Section 80TTA to ₹50,000 and Section 80TTB to ₹1,00,000.

Income Tax Deduction under Section 80RRB

Section 80RRB of the Income Tax Act allows individuals to claim deductions for royalty payments received.
Royalty is compensation received for the use of intellectual property like books, art, or inventions.
The patent must be registered under the Patents Act, 1970.
The deduction is either ₹3 lakh or the royalty received, whichever is lower.

Income Tax Deduction under Section 80QQB

Section 80QQB applies to book authors (fiction, non-fiction, scientific, technical, etc.).
This section offers a deduction of ₹3 lakh or the actual royalty received, whichever is lower.
It does not apply to journals, newspapers, or textbooks.
Any royalty income from abroad must be repatriated within a specified time frame to qualify for deductions.

Income Tax Exemptions for Salaried Employees 2025-26

Salaried individuals can significantly optimize their tax liabilities for FY 2025-26 (AY 2026-27) by using various exemptions applicable to their salary income. These exemptions, distinct from deductions, reduce taxable income at the source, provided specific conditions are met.

Key tax exemptions for salaried employees include:

Standard Deduction: A flat deduction of ₹50,000 from gross salary income for salaried individuals and pensioners (as per current provisions for FY 2025-26, subject to change).
House Rent Allowance (HRA): Exemption on HRA received, calculated based on salary, HRA component, actual rent paid, and city of residence (metro/non-metro).
Leave Travel Allowance (LTA): Exemption for domestic travel expenses for the employee and family, available for two journeys in a four-year block, subject to conditions.
Allowances under Section 10(14): Exemptions for allowances granted for official duties, up to the amount expended. Examples include uniform, daily, conveyance, and research allowances.
Children's Education & Hostel Allowance:
- Education Allowance: Up to ₹100 per month per child (max. two children).
- Hostel Allowance: Up to ₹300 per month per child (max. two children).
Professional Tax: Deduction for Professional Tax levied by state governments from gross salary income.
Food Vouchers/Coupons (Perquisites): Tax exemption on non-transferable food coupons provided by employers, typically up to ₹50 per meal, under specified conditions.

Wrapping Up

To wrap up, knowing about the different income tax deduction list, such as those from Section 80C to 80U, and understanding your tax exemptions can really help you plan your taxes better for the financial year 2025-26 (Assessment Year 2026-27). By making use of these rules, you can lower the amount of tax you need to pay and keep more of your hard-earned money. Tax rules can change, so it is always a good idea to stay informed and consider getting advice from a professional to make sure you are saving as much as you legally can.

FAQs on Income Tax Deduction List

What are the deductions in income tax?

Income tax deductions list, such as those under Sections 80C, 80D, 80G, and 80E, offer various benefits. Examples include deductions for investments like PPF and ELSS, medical insurance premiums, charitable donations, and interest on education loans.

Can I claim the 80C deductions at the time of filing the income tax return in case I have not submitted proof to my employer?

No, you cannot claim deductions under Section 80C when filing your income tax return if you have not submitted the necessary proof of investments or expenses to your employer. To avail of the deductions, you must provide the relevant proof to your employer during the income tax declaration submission period, usually at the beginning of the financial year. Your employer will consider these proofs and adjust your TDS (Tax Deducted at Source) accordingly.

I have availed a loan from my employer to pursue higher education. Can I claim the interest paid on such a loan as a tax deduction under Section 80E?

Yes, you can claim the interest paid on a loan from your employer for pursuing higher education as a tax deduction under Section 80E. This deduction is available for a maximum of 8 years or until the interest is fully repaid, whichever is earlier. However, please note that this deduction is only applicable for loans taken for the individual’s own education or for the education of their spouse, children, or a student for whom they are a legal guardian.

Is there any restriction or maximum limit up to which I can claim a tax deduction under Section 80E?

There is no upper limit on the amount of interest you can claim as a deduction under Section 80E. The entire interest you pay on the loan qualifies for the deduction. Please note that the deduction only applies to the loan’s interest component, not the principal amount.

Can a company or firm reap the benefits of Section 80C?

No, Section 80C deductions are not available to companies or firms. Section 80C provides tax-saving benefits on various investments and expenses for individual taxpayers only. Some of the eligible deductions under Section 80C include investments in Public Provident Fund (PPF), Employee Provident Fund (EPF), Equity-Linked Saving Scheme (ELSS), National Savings Certificate (NSC), and payment of life insurance premiums, among others.

Can a company claim a deduction for donations made under Section 80G?

Yes, companies can claim a deduction for donations made to eligible charitable institutions under Section 80G of the Income Tax Act. The deduction amount varies based on the charitable organization type and can be 50% or 100% of the donated amount. However, it is important to ensure that the charitable institution is registered under Section 80G to avail of this deduction.

Are the tax exemptions available under Section 80D available to corporations?

No, the Section 80D deduction is only for individuals and Hindu Undivided Families (HUFs). It covers health insurance premiums for yourself, your spouse, children, and parents, but it does not extend to companies or firms.

What are the tax exemptions available under Section 80DD?

Section 80DD provides tax relief for individuals and HUFs who spend on the care of a dependent with a disability. If you incur expenses for their medical treatment or rehabilitation, you can claim up to ₹75,000 as a deduction. For severe disabilities, this amount goes up to ₹1,25,000.

Are bank recurring deposits eligible for tax deduction?

No, bank recurring deposits (RDs) are not eligible for tax deduction under Section 80C. The only term deposits that qualify for tax deduction under Section 80C are Fixed Deposits (FDs) with a minimum lock-in period of 5 years in a scheduled bank.

Are all allowances taxable for salaried individuals?

No, not all allowances are taxable for salaried individuals. Some allowances are fully taxable, while others are partially or fully exempt from tax. For example, the House Rent Allowance (HRA) can be partially exempt if certain conditions are met. Similarly, the Leave Travel Allowance (LTA) and certain allowances for specific purposes may also be exempted up to prescribed limits.

Can both earning members of a family claim tax deductions for a home loan taken as co-applicants?

Yes, both earning members of a family who are co-applicants of a home loan can claim tax deductions individually. Each co-applicant can claim deductions on the principal amount under Section 80C and on the interest paid under Section 24(b) of the Income Tax Act, subject to specified limits.

Can self-employed individuals claim the HRA benefit?

No, the HRA benefit is available only to salaried individuals and not to self-employed individuals. Self-employed individuals cannot claim HRA as they do not receive a fixed salary from an employer, which is a prerequisite for claiming HRA deductions.

How can I save tax on an education loan?

You can reduce your tax liability on an education loan by claiming deductions on the interest paid under Section 80E of the Income Tax Act. The loan must be taken for higher education for yourself, your spouse, children, or a student under your legal guardianship. There is no maximum deduction limit. You can claim it for up to 8 years or until the interest is fully repaid, whichever comes first.

What are the examples of income tax exemptions?

Examples of income tax exemptions include the HRA received by salaried individuals, LTA, certain agricultural income, interest earned on tax-saving bonds, income from dividends on certain mutual funds, and exemptions provided for certain allowances for specific purposes.

What are the examples of income tax deductions?

Examples of income tax deductions include deductions under Section 80C for investments in PPF, EPF, ELSS, NSC, and payment of life insurance premiums, deductions under Section 80D for medical insurance premiums, deductions under Section 80G for donations to charitable institutions, and deductions under Section 80E for interest paid on education loans, among others.

How much total deduction is allowed in income tax?

In India, the total income tax deduction allowed depends on various factors such as investments, expenses, and contributions made during the financial year. Common deductions include those under Section 80C (up to ₹1,50,000), Section 80D (health insurance premiums), Section 80E (education loan interest), and others. Taxpayers can avail of deductions based on their eligibility and compliance with the Income Tax Act.

What is a deduction from salary in income tax?

Deduction from salary in income tax refers to the amount subtracted from an individual’s gross salary to arrive at the taxable income. This deduction includes components like provident fund contributions, professional tax, standard deduction (if applicable), and any other eligible allowance or exemption in income tax as per the Income Tax Act.

What is the standard deduction for income tax?

The standard deduction for income tax, set at ₹75,000, applies for the assessment year 2026-27. This fixed amount, deducted from gross salary to calculate taxable income, remains consistent under the old and new tax regimes.

How to calculate tax on salary?

First, determine the taxable income by subtracting allowable deductions (such as standard deduction, HRA exemption, etc.) from the gross salary to calculate tax on salary. Then, apply the applicable income tax slab rates to the taxable income to calculate the total tax liability. Finally, deduct any applicable rebates and claim tax credits to arrive at the final tax payable amount.

What deductions can I claim on tax?

Taxpayers can claim various deductions on tax based on investments, expenses, and contributions made during the financial year. Common deductions include those under Section 80C (for investments like PPF, ELSS, etc.), Section 80D (for health insurance premiums), Section 80E (for education loan interest), Section 80G (for donations to charitable institutions), and more. It is essential to review the eligibility criteria and compliance requirements outlined in the Income Tax Act to claim deductions accurately.