Section 80C of the Income Tax Act

Section 80C allows you to claim deductions of up to Rs. 1.5 lakh per year from your taxable income. Under this Income Tax Act of 1961, tax benefits are available for investments and expenses made in certain tax-saving options. You can lower your tax liability while filing your income tax return (ITR) by utilising Section 80C.

4.8^~ Rated
7.7 Crore Registered Consumer
50 Partners Insurance Partners
4.2 Crore Policies Sold

Tax Saving Plans

Get Returns That Beat Inflation
Zero Capital Gains tax^¶
Save upto Rs 46,800In Tax under section 80C^{^}

We are rated^~

7.7 Crore

Registered Consumer

Insurance Partners

4.2 Crore

Policies Sold

Get Instant Tax Receipts

Save Upto ₹46,800 in Taxes Under Section 80C^{^}

Your Name

+91

Mobile Number

View Plans

Your personal information is secure with us

By clicking on "View Plans" you agree to our Privacy Policy and Terms of use

Get Updates on WhatsApp

Disclaimer: ^Section 80C allows annual deductions of up to ₹1.5 lacs from the taxable income. Section 10(10D) provides tax-free maturity benefits for investments of up to ₹2.5 Lacs/ year, on policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws. All plans listed here are of insurance companies’ funds.

We are rated^~

7.7 Crore

Registered Consumer

Insurance Partners

4.2 Crore

Policies Sold

What is Section 80C?

Section 80C is a provision under the Income Tax Act, 1961 that allows you to reduce your taxable income by Rs. 1.5 lakhs for the various expenses and premiums paid in the tax-saving investments. Some of the popular tax-saving investments to avail of this benefit are Unit Linked Insurance Plans (\ULIP), Public Provident Fund (PPF), National Pension System (NPS), and Equity Linked Savings Scheme (ELSS).

You can claim the Section 80C deduction while filing your annual Income Tax Return (ITR) to reduce your tax liability. The Income Tax Department of the Government of India refunds the excess money to your bank account.

Important Updates on Section 80C in Budget 2024 for FY 2024-25 (AY 2025-26):

The Union Budget 2024 made no changes to the Section 80C benefits available with the old tax regime.
It must be noted that the Union Budget 2023 removed the deductions in the new tax regime available under Section 80C.

Section 80C Deductions List with Additional Sections

The following sections under the Income Tax Act are also popular along with Section 80C to claim deductions on your taxable income:

Section under Income Tax Act, 1961	Investments Eligible for Deduction	Maximum Deduction
Section 80C	Invest in best investment options like Unit Linked Insurance Plan (ULIP), Equity Linked Saving Schemes (ELSS), Provident Fund contributions, Life Insurance premiums, Principal of home loan, SCSS, SSY, and NSC	Rs. 1.5 lakhs
Section 80CCC	Contributions to pension funds like Public Provident Fund (PPF)	Rs. 1.5 lakhs
Section 80CCD(1)	Contributions to Atal Pension Yojana (APY) or other government-sponsored pension schemes	Employed: 10% of Basic Salary + DA Self-Employed: 20% of Total Income
Section 80CCE	Overall deduction under Section 80C, 80CCC and 80CCD(1)	Rs. 1.5 lakhs
Section 80CCD(1B)	Contributions to NPS	Rs. 50,000 (over and above the deductions under Section 80CCE)
Section 80CCD(2)	Employer’s contribution to NPS (outside Rs 1.5 lakhs limit under Section 80CCE)	Central Government Employer: 14% of Basic Salary +DA Other Employers: 10% of Basic Salary +DA
Section 80D	Health insurance premiums for self, spouse, children, and parents	- Self, Spouse, Children: Rs. 25,000 - Parents (Below 60 years): Rs. 25,000 - Parents (Above 60 years): Rs. 50,000 - Additional Deduction (Self and Parents above 60 years): Rs. 50,000 (each)

Eligibility Criteria for Section 80C Deductions

You must fulfil the following eligibility conditions to avail of deductions under Section 80C of the Income Tax Act, 1961:

You are eligible if you fall under one of the following taxpayer categories:
- Resident Indians
- Non-Resident Indians (NRIs)
- Hindu Undivided Family (HUF)
Ineligible Taxpayers:
- Companies
- Partnerships
- Corporate Bodies

Section 80C Deduction List

The premium paid to the following best investment plans are eligible for deductions under Section 80 C of the Income Tax Act, 1961:

Tax Saving Investments	Risk Profile	Interest (in %)	Guaranteed Return	Lock-in Time (Minimum)
Unit Linked Insurance Plan(ULIP)	Moderate to High	12% - 15% p.a. (depending on the chosen plan)	No	5 years
Capital Guarantee Plan	Low	5% – 18% p.a.	Yes	5 years
Equity Linked Savings Scheme(ELSS)	High	8% - 12 % approximately	No	3 years
National Pension Scheme(NPS)	High	9% to 15% p.a.	No	3 years
Life Insurance	Low	Returns vary from plan to plan	Yes	Varies from plan to plan
Public Provident Fund(PPF)	Low	7.1% p.a.	Yes	15 years
National Savings Certificate(NSC)	Low	7.7% p.a.	Yes	5 years
Tax Saving FDs	Low	5.5% to 7.75% p.a.	Yes	5 years
Sukanya Samriddhi Yojana(SSY)	Low	8.20% p.a.	Yes	Less of, 21 years or till girl’s marriage after 18 years of age
Senior Citizen Saving Scheme(SCSS)	Low	8.20% p.a.	Yes	5 years

Details of the Investment Options for Section 80C Benefits

Learn the key details mentioned below of the various investment options available to gain the benefits under Section 80C:

High-Risk, High-Return Investment Options for Section 80C Deductions

Following are high-risk high-return investment plans to claim deductions under Section 80C of the Income Tax Act, 1961:

Unit Linked Insurance Plan (ULIP):
- It combines investment and life insurance.
- Part of the premium goes towards a life cover, and the rest is invested in various market-linked assets.
- Offers moderate to high returns based on market performance.
Moderate Risk, Moderate Return Options for Section 80C Deductions

The moderate risk investment options for Section 80C deductions are as follows:

National Pension Scheme (NPS):
- Long-term retirement savings scheme that offers pension after retirement.
- Offers tax benefits under both Section 80C and 80CCD(1B).
- Can be partially withdrawn before retirement.
Public Provident Fund (PPF):
- Government-backed long-term investment option.
- Fixed return investment option with current PPF interest rate of 7.1%
- Offers guaranteed returns and tax-free maturity proceeds.
National Savings Certificate (NSC):
- Government-backed fixed-income investment.
- Offers fixed returns over a specified period.
- Lower liquidity compared to other options.
Low-Risk, Low-Return Options for Section 80C Deductions

The low-risk with low return investments to avail of the Section 80 C deductions are mentioned below:

Tax Saving Fixed Deposits (FDs):
- Banks and post offices both offer tax-saving fixed deposit schemes.
- Principal invested is eligible for deduction under Section 80C, but interest income is taxable.
Life Insurance:
- Provides financial security for dependents in case of untimely death.
- Part of the premium qualifies for deduction under Section 80C.
- Returns are generally lower compared to other investment options.
Sukanya Samriddhi Yojana (SSY):
- Government-backed scheme for girl child's education and marriage.
- Offers tax benefits under Section 80 C and higher SSY interest rate of 8.2% p.a.
Senior Citizens Saving Scheme (SCSS):
- Exclusively for individuals aged 60 years and above.
- Offers higher interest rates than regular savings schemes.
Specific Investments/ Expenses for Section 80C Deductions

Following are some of the specific schemes and expenses that can help you claim up to ₹1.5 lakhs p.a. of deductions under the Section 80C:

NABARD Rural Bonds:
- Offered by the National Bank for Agriculture and Rural Development (NABARD).
- Returns are generally higher than traditional fixed-income investment options as it offers tax—free interest.
- The lock-in period varies depending on tenure, like 10, 15 or 20 years.
Infrastructure Bonds
- Principal invested is eligible for deduction under Section 80C, but interest income is taxable.
- The lock-in period is generally 10 to 15 years.
Repayment of Home Loan Principal Amount
- You can claim a deduction for the principal portion of your home loan repayment.
- The loan should be taken for acquiring, constructing, purchasing, or improving a residential house property.
- The property should be self-occupied or let out.
Registration Charges and Stamp Duty for a Home/Property
- Registration charges and stamp duty paid for acquiring a residential property are eligible for deduction under Section 80C.
- The combined deduction for principal repayment, registration charges, and stamp duty cannot exceed Rs. 1.5 lakhs per financial year.

When to Invest for Section 80C Deductions?

It is beneficial that you invest for the deductions under Section 80 C before the end of the financial year, i.e. 31 March. This way can help you to claim the Section 80C deduction in the same way to reduce your taxable income.

Ensures that your investments are evenly spread-out throughout the year to help avoid last-minute rush and possible issues that may arise during the final quarter of the financial year.

Trending in Tax Savings

Income Tax Take Home, Net Gross Salary vs CTC Tax Saving - How to Save Income Tax For FY 2024-25 Income Tax Slab Rates for FY 2024-25 (AY 2025-26)

Income Tax Return Filing Advance Tax Payment Best ELSS Mutual Funds in 2024 How to Invest in ELSS Mutual Funds

What is Form 16 & How to Download It PPF or Public Provident Fund Account: A Complete Guide What is the Difference between Assessment Year and Financial Year?House Rent Allowance

TDS on EPF Withdrawal of More than Rs 50,000 How to Withdraw Your PPF Amount Online?Section 10 of the Income Tax Act Hindu Undivided Family (HUF)

Tax Rebate under Section 87A as per Union Budget 2024 Section 24 of the Income Tax Act Section 139 of the Income Tax Act Capital Gains Tax: Types, Rate & Calculation Process

Tuition Fees Deductions Available Under Income Tax Section 16 of the Income Tax Act Section 54F of the Income Tax Act Old vs New Tax Regime FY 2024-25 (AY 2025-26)

Union Budget 2024 Deductions in New Tax Regime under Union Budget 2024 Gratuity Eligibility Before and After Completion of 5 Years SBI PPF Calculator

Income Tax Above 5 Lakh Income Tax Above 15 Lakh Income Tax Above 10 Lakh Advance Tax Calculator

Understanding Section 80GG: A Tax Deduction for Rent Paid Section 80TTA/80TTB: Deductions for Interest Income Section 80CCD (1) and 80CCD (2)Form 10-IC of Income Tax Act

Form 10A of the Income Tax Act

Summing It Up

Section 80C of the Income Tax Act serves as a significant financial tool for you to claim deductions and reduce your taxable income. It also allows you to build a huge corpus and develop a diversified portfolio with long-term investment options. These diverse investment options empower you to make strategic financial decisions and responsible financial planning for a secure future.

Frequently Asked Questions

What is Section 80C?

Section 80C of the Income Tax Act, 1961, is a provision that allows you to deduct certain investments and expenses from your taxable income, hence, reducing your income tax liability.
How to calculate the 80C deduction?

Calculating your 80C deduction involves understanding which expenses and investments qualify, their limits, and then determining the optimal mix to maximize your tax benefit within the overall limit of Rs. 1.5 lakhs per year.
What comes under 80C?
Under Sec 80C if you invest or spend money on certain things allowed, the government will reduce your taxable income by that amount. This means you will pay less income tax.
Some of the common eligible investments and expenses under Section 80C are as follows:
- Unit Linked Insurance Plans (ULIPs)
- Provident fund (PF) contributions
- Equity Linked Saving Schemes (ELSS)
- National Pension System (NPS)
- Tuition fees
- Home loan principal repayment
Is PF part of 80C?

Yes, PF (Provident Fund) is part of Section 80C of the Income Tax Act, 1961, in India. This means that contributions made towards your PF account (both Employee Provident Fund (EPF) and Voluntary Provident Fund (VPF)) are eligible for deduction from your taxable income up to a maximum limit of Rs. 1.5 lakhs in a financial year.
Can I invest in more than 1 investment policy and claim Rs. 150,000 exemptions each?

No. Rs. 1,50,000 is the maximum exemption limit regardless of the number of policies or investments made under Section 80C of the Income Tax Act, 1961.
Is donation eligible for tax exemption?

Yes, but only specific funds and institution donations are eligible for the exemption of tax under Section 80C of the IT Act.
When can I claim my 80C deductions?

Deductions under any Section can be claimed during the filing of Income Tax Return at the end of each assessment year.
Which investment method should I go for to save taxes?

There are many Insurance Policies, Fixed Deposits, Mutual Funds, Public Provident Funds, etc. available in the market which an individual or Hindu Undivided Family (HUF) can opt for to save their taxes. However, keeping in mind factors like personal appetite, age, and assets in hand, is very important before making any kind of investment.
What is 80C and 80D in Income Tax?
- Section 80C: Allows deductions up to Rs. 1.5 lakh on investments like EPF, PPF, life insurance premiums, etc.
- Section 80D: Provides deductions on health insurance premiums up to Rs. 25,000 (Rs. 50,000 for seniors) per year.
Is HRA part of 80C?

No, HRA (House Rent Allowance) is separate and governed under Section 10(13A) for rent paid by employees.
Is EPF counted in 80C?

Yes, EPF (Employee Provident Fund) contributions qualify for deductions under Section 80C.
Can I claim HRA and 80C both?

Yes, you can claim HRA under Section 10(13A) and deductions under Section 80C simultaneously.
Can I claim 100% tax benefit as co-owner?

Tax benefits for home loans or property investments are typically based on ownership share in the property. Each co-owner can claim deductions in proportion to their ownership stake.

†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ

Maximise your
Tax Savings!