Qualifying Investments
-- Equity Linked Saving Schemes
Investments in equity linked saving schemes i.e mutual funds qualyfies for deduction u/s 80c but comes with a lock in period of 3 years.
-- Unit Linked Insurance Plans
ULIPs offer life insurance and equity investment in one package, eligible for deduction u/s 80c.
-- Public Provident Fund
Maximum investment in PPF can be Rs.70,000. There is a lock in period of 15 years.
-- National Saving Certificate
NSC has 6 years lock in period. Interest earned is deemed to be reinvested and is eligible for deduction u/s 80c.
-- Infrastructure Bonds
Bonds issued by companies are eligible for deductions u/s 80c.
-- Bank Fixed Deposit
Tax-saving fixed deposits (FDs) of scheduled banks with tenure of 5 years are eligible for deductions u/s 80c.
-- Post Office Time Deposit
Post Office Time Deposits with tenure of 5 years are eligible for deductions u/s 80c.
-- Senior Citizen Saving Scheme
SCSCs are only meant for senior citizens. Interest income is taxable.
-- Provident Fund (PF) and Voluntary Provident Fund (VPF)
PF is deducted from your salary and is eligible for deduction u/s 80c. Both the employer and employee contribute to PF.
Additional contribution can be made via VPF.
-- NABARD Bonds
Only NABARD Rural Bonds qualify for deductions u/s 80c.
-- Life Insurance Premium
An amount paid for insuring life for yourself, your spouse or children is eligible for deduction. Premiums for all life insurance policies should be clubbed together to claim deduction u/s 80c.
-- Housing Loan Repayment
The principal component of your home loan amount is eligible for deduction u/s 80c.
-- Children’s Tuition Fees
Full time education of any two children in any university, college, school or other educational institution is eligible for deduction u/s 80c. Tuition fees for adopted child is also eligible. Receipts are to be submitted.
Example
Suppose your annual income is Rs.10 lakhs and you make investments totalling Rs.1 lakh then your taxable income will be Rs.9 lakhs.
Taxable Income = Gross Income – Deduction U/S 80C
-- Equity Linked Saving Schemes
Investments in equity linked saving schemes i.e mutual funds qualyfies for deduction u/s 80c but comes with a lock in period of 3 years.
-- Unit Linked Insurance Plans
ULIPs offer life insurance and equity investment in one package, eligible for deduction u/s 80c.
-- Public Provident Fund
Maximum investment in PPF can be Rs.70,000. There is a lock in period of 15 years.
-- National Saving Certificate
NSC has 6 years lock in period. Interest earned is deemed to be reinvested and is eligible for deduction u/s 80c.
-- Infrastructure Bonds
Bonds issued by companies are eligible for deductions u/s 80c.
-- Bank Fixed Deposit
Tax-saving fixed deposits (FDs) of scheduled banks with tenure of 5 years are eligible for deductions u/s 80c.
-- Post Office Time Deposit
Post Office Time Deposits with tenure of 5 years are eligible for deductions u/s 80c.
-- Senior Citizen Saving Scheme
SCSCs are only meant for senior citizens. Interest income is taxable.
-- Provident Fund (PF) and Voluntary Provident Fund (VPF)
PF is deducted from your salary and is eligible for deduction u/s 80c. Both the employer and employee contribute to PF.
Additional contribution can be made via VPF.
-- NABARD Bonds
Only NABARD Rural Bonds qualify for deductions u/s 80c.
-- Life Insurance Premium
An amount paid for insuring life for yourself, your spouse or children is eligible for deduction. Premiums for all life insurance policies should be clubbed together to claim deduction u/s 80c.
-- Housing Loan Repayment
The principal component of your home loan amount is eligible for deduction u/s 80c.
-- Children’s Tuition Fees
Full time education of any two children in any university, college, school or other educational institution is eligible for deduction u/s 80c. Tuition fees for adopted child is also eligible. Receipts are to be submitted.
Example
Suppose your annual income is Rs.10 lakhs and you make investments totalling Rs.1 lakh then your taxable income will be Rs.9 lakhs.
Taxable Income = Gross Income – Deduction U/S 80C
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