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80C Tax Saving Options & deductions (FY 2016-2017)

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80c-tax-deduction

In the month of March, most tax payers rush to invest their money in tax saving instruments. Though it is better to do the tax planning at the start of year & plan your investments over the whole year. Many salaried taxpayers has to submit the investment proofs etc to their employer in Jan. 

Section 80C of the Income tax Act 1961 provides list of Investments / expenses which is allowed as Deduction from your taxable Salary. 80c tax exemption limit from FY 2016-17 is Rs 1.5 Lakh. Under 80C, you can claim maximum deduction of Rs 1.50 lakh.

Apart from below 80C deductions, you can also check other tax benefits under 80D to 80U (Read here)

Read my other post13 Important things to know before you file your Income Tax returns.

List of deductions under Section 80C –

Investment  Eligible for deduction u/s 80C
PF/ EPF (Employee Provident Fund
 
PPF – Public Provident Fund
 
NSC – National Savings Certificate
 
5 year Tax Saver Bank FD
 
5 year Post Office Time Deposit
 
Senior Citizen Savings Scheme
 
NHB Suvriddhi Bonds
ELSS – Equity Linked Savings Scheme Mutual fund
 
Life Insurance Premium
 
ULIP – Unit Linked Insurance Plan
 
Pension Fund
 
NPS – National Pension Scheme
Children Tuition Fees
 
Home Loan Principal Repayment
 
Stamp Duty & registration charges for home

1. PF / EPF – Provident Fund:  For Salaried employees, PF is default investment which qualifies for deduction u/s 80C. Employers take this investment into account while deducting TDS. You can check the monthly PF deduction in your payslip and check what balance amount you need to invest in other 80C securities.  Current interest is 8.8%. Interest Tax free.  Read – How to check your PF Balance online

2. PPF – Public Provident Fund:  PPF is available for both salaried & self-employed people . It is one of the best long term saving options which is safe & give assured returns. Maturity period is 15 years & current interest rate is 8.8% tax free.

3. ELSS – Equity Linked savings scheme:  ELSS mutual fund are mutual fund schemes which are approved for tax savings. These funds have lock-in period of 3 years and underlying investment in Equity. If you invest for long term, then ELSS has potential to give handsome returns. Read – Best performing ELSS Funds 

4. Life insurance premium: Life Insurance premium you, spouse & children is eligible for deduction u/s 80C. You can take insurance policy from, LIC or any private insurer.  From 01-April-2013, Only premium equal to 10% of sum assured will be allowed. So make sure, you have sum assured of 10 times the annual premium. If premium is more than 10% of sum assured, you can only claim up to 10% of Sum assured.

5.  NPS – National Pension Scheme: Under Section 80CCD, any contribution made NPS Tier I scheme is allowed as deduction. But, you can claim a maximum deduction of Rs 1.5 lakh under Section 80C, 80CCC and 80CCD combined. An additional exclusive tax benefit of Rs.50,000/- under section 80CCD (1B) per assessment year (applicable from FY 2015-16/AY 2016-17) for NPS investments.

6.  Tuition fees:  Any amount paid as tuition fee for the education of the first 2 children is eligible for deduction u/s 80C. The deduction can be claimed for full-time courses including pre-nursery and playschool.

7. Stamp Duty and Registration Charges for a home: If you have bought a house and paid stamp duty & registration charges, you can claim deduction under section 80C for these charges.

8. Home Loan Principal Repayment: You can claim the Home loan principal repayment as deduction under section 80C. Only principal qualifies for deduction under Sec 80C.  The deduction for interest component can be claimed under Section 24 of the Income Tax Act. Read – Tax benefits on Home Lone – Section 24, 80C, 80EE

9. NSC – National Savings Certificate:  You can purchase NSC through post office Period of NSC is 5 years or 10 years. Current interest is 8.6-8.9% (taxable)
The interest accrued every year is liable to tax (i.e. included in your taxable income) but the interest is also deemed to be reinvested and thus eligible for section 80C deduction. 

10.  5 year Bank Fixed Deposit: These are special 5 year FD by banks which are eligible for deduction u/s 80C. You need to ask bank that you need “Tax Saver FD”, bank will then put a stamp on your FD regarding 5 year lock-in. Interest Rates are 8.5 -9.5% (Taxable)

11. 5-Yr post office time deposit (POTD) scheme: 5-Yr post-office time deposit (POTD) qualifies for tax saving under section 80C. Interest – 8.5 % (Taxable)

12. NHB Suvriddhi: National Housing Bank (Tax Saving) Term Deposit Scheme is also eligible for deduction u/s 80C. The duration of this scheme is  5 years and Interest rate is 9.25% (taxable, also TDS) See details at NHB website.

14. Pension Fund: Any premium paid towards any Pension Fund (LIC or private insurer) annuity plan, whether deferred or immediate will give you tax relief u/s 80CCC.  (part of section 80C for overall Rs 1 lakh limit.)

13. ULIP – Unit linked Insurance Plan: ULIPs are a combination of life insurance and investments. Few years back, distributors were pushing ULIP to customers because they were getting hefty commission upto 70% of first year premium. But now, IRDA has capped the total charges to 3%.  So current ULIP schemes are better than previous ones but still there are other investment options which can yield the same results at a lower cost.  SO AVOID.

80C deductions for NRI

As an NRI, you can also claim deduction u/s 80C by investing in all of the products above except

  • new investment in NSC
  • 5 year post office FD
  • new PPF account opening (contribution to existing PPF is eligible)

How to claim 80C deduction

If you are salaried employee, you should normally declare your investments to your employer & submit proofs. Employer will then give you the deduction when calculating TDS.

You will need to submit Form 12BB for claiming 80C deductions, HRA & LTA. Read more details about this new FORM 12BB

In case you could not submit proofs to employer, you can still claim the deduction u/s 80C while filing your Income Tax returns.

Apart from above 80C deductions, you can also check other tax benefits under 80D to 80U (Read here)

Read my other post – 13 Important things to know before you file your Income Tax returns.

If you have any tax queries, please comment below.

If you have any queries related to this article or any other personal finance query ( Investment, Taxation etc), please comment below

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168 comments

  1. Can u give me revisd shedule vi in pdf format?

  2. 5 year bank fixed deposit in the name of the spouse whether the husband/wife are eligible under section 80c ??

    • Hi Rajesh, No

      The tax saver FD should in in primary name of tax payer who want to take deduction.

      • Hi Vivek,

        Just need small clarification. According to you If “Tax Saver FD” is on my wife’s name, then I cant show this amount for tax exemption under 80C, Correct ?
        Is there any way I can show this amount for tax exemption under 80C ? there is something called “Clubbing of Income”. Is there any provision through this ?

        Thanks
        Umesh

        • Yes if your wife is first holder of FD, then you cannot claim 80C benefit.
          You need to be first holder of the FD to claim.
          The interest on FD may be clubbed to your income if you have given the amount to your wife for FD (without any consideration)

    • The interest drawn monthly on the investment made under 80(c) Tax saver scheme in FD in Bank does qualify for tax exemption or the interest paid should also be shown as income earned and pay further Tax?

  3. sir, my daughter is working as a consultant doctor for rs 90,000.00 per month consolidated. they are deducting 10% as TDS EVERY MONTH. pl.let me what deductions she can claim at time of filing her income tax return.
    i will be highly obliged.
    tks

    • At the time of filing return, she can claim her business expenses like Phone, office rent, travel etc.

      As she has income from business / profession, she needs to file return in ITR 4. it is better that she keep records of her income & expenses.

  4. I booked a new flat under construction through bank loan.Registration done by 15/5/2014 and mortgage by 12/8/14.Flat is ready on feb 2015.Sir i eligible to.deduct registration and stamp duty in 80c in 2014-2015 assessement year

  5. Is stamp duty & registration fee allowed for purchase of new house only or it is allowed when a house is purchased (whether new or old)?

  6. Is 80C deduction available for the amount paid towards life insurance while getting a housing loan?

  7. Are five year bank deposits , tax saving bank deposits available to nri, pio,oic also?

    • Yes, 5 year tax saving deposit are available to NRI.

      However, NRI are not allowed to open new PPF, or new investment in NSC, Post office time deposits etc. they can continue if they are subscribed before becoming NRI.

      • I’m an NRI. When I contacted SBI, they mentioned that they won’t offer NRO Tax savings FD but when I contacted ICICI, they mentioned that they offer NRO tax savings FD.. Does any FD with lock in period of 5Yrs treated as ‘Tax Savings FD’ (or) does FD need to specifically say it’s a tax saver FD. I’m surprised why one bank offers it & other bank doesn’t offer it. Does ICICI just open a 5 yrs FD and call it as ‘Tax Saver FD’. Please let me know

        • Hi Ravi, if the FD has lock in period of 5 years, then you can claim deduction u/s 80C as tax Saver FD. The lock-in is not same as Maturity period.
          If you make normal FD for 5 years, you can always break the FD before that. But if the FD is tax saver & there is a lock-in, then you cannot break it before 5 years.

  8. mahesh chaaaand tayal

    Sir, If i give a gift to my daughter in cash. can i take benifit saving in u s 80c.

  9. Sir,

    I have done 5 year tax saver FD in 2013. Can i still declare it in FY2014-2015 or do i have to apply for a new one?? Please assist? And me and my husband bought a ready to move in flat this year..but the registration is in his name,can i still claim for stamp duty and registration fees under 80C.???

    • You cannot claim the FD tax deduction in FY 2014-2015 for FD made in 2013. You can only claim once in the year it was made.
      You cannot claim the stamp duty if the flat is only in your husband’s name.

  10. Sir,

    I would like to know more about 5-yr FD. Can we claim it’s deduction each year or is it available only at the time of investment i.e. 1st year. Further, what about the proceeds at maturity, they are taxable or exempt?

    • Hi Shilpa,
      You get the deduction only in the year of Investment. Also, the interest earned on such FD is taxable every year.

      You can consider also investment in ELSS Funds for tax saving.

      • Hi Vivek,

        Can you please suggest which ELSS Scheme is best as of now ? Do we have any Risk in investing in ELSS ? I am planning to invest in SIP Mode..any advantage or disadvantage on this please ?

        • Hi Vinay, It is better to invest via SIP mode as it allows to distribute your investment over a period of time.
          ELSS funds invest in Equities, so it has risks relate to market. If the stock market is not doing good, then the funds will not perform also. So you should have ability to hold the investment for few more years in case market is not good.

          Some of the best ELSS funds are given in post above.

  11. sir,
    i purchased a residential plot, can i deduct stamp duty and registration charges under 80 c ?

    • u/s 80C, stamp duty and registration charges are allowed only for residential house property and not land.

      • Dear Vivek Sir,

        I am planning to buy a residential plot of land and immediately I am planning to construct a residential house on it, for me. Whether I am eligible to claim tax benefits u/s 80C against the cost incurred under stamp duty and registration OR it is applicable for ready built house only?

        Please clarify?

  12. Kindly let me know whether there is any rule that we have to pay HRA in cheque and we can claim tax deduction only if HRA is paid in cheque.

  13. sir,
    I invest in post office 5 yrs TD in Dec14. Now I want to cancel the TD in April15 for personal work. can i claim the TD in 80c. & stamp duty, registration fee allowed only for house, or site purchase too.

    • 1) stamp duty, registration fee is allowed only for house, (Not plot)
      2) If you have taken 80C deduction for PO5 year TD, you cannot cancel it now. Even if you manage to cancel, then the deduction amount taken previously, will be taxed in this year.

  14. can i open fd under either or surviver option for 80c deduction

    • For 80C Fixed deposit – Joint deposits are permitted (including Either or Survivor / Former or Survivor). However, the tax benefit under section 80C goes to the first holder only.

  15. Sir,

    I have brought ulip policy dt 1/12/2008 its maturity period is 1/12/2018,
    I paid premium for three year locking ( 2008, 2009 and 2010) and used for tax saving.
    As per policy agent it is lapse for not paying for 2011,12,13 and 2014

    The amount is 400000,
    Is it taxable after six year from( 2008 -2014 )

    Saroj

    • Hi Saroj, Can you please give exact policy name ?
      how much premium did you pay annually
      how much is sum assured & initial duration?

      • Sir ,
        Details are as below
        Plan = Reliance – Automatic Investment Plan- Reg
        Annually premium = 75000/ – and
        Sum assured = 3,75000 / –
        Premium paying Term = 10 year

        Saroj

        • Hi Saroj, I think the ULIp policy is Reliance Super Automatic Investment Plan and you might have chosen the ” Life” option

          As you have paid premium for 3 years – If due premiums have been paid for at least three consecutive years and subsequent premiums
          are unpaid, the policy will remains in force with sum assured intact. The rider benefits if any will cease immediately. The mortality and
          administration charges will be deducted from your account by cancellation of units. The fund management charge will be priced in the
          unit value. You will continue to participate in the performance of the unit funds chosen by you.

          You may have revided the policy by paying due premiums within 2 years. But as you have not done, there were 2 options
          1) the policy will be terminated by paying the surrender value. have you received any amount back in 2012 (after you did not pay 2011 & 2012 premium)
          2) the policy can continue – The mortality and administration charges will be deducted from your account by canceling the units. You will continue to participate in the performance of the unit funds chosen by you.
          This option will be available until the fund value does not fall below an amount equivalent to one full year’s premium plus the surrender charge, if any.
          If at any point of time, the fund value reaches an amount equivalent to one full year’s premium plus the surrender charge, if any, the policy will be terminated by paying the annualised premium.

          I think you should get in touch with the Reliance Life office or your agent to get the latest statement of your ULIP,

          You can call / visit Reliance Life. Keep your policy details with you when talking to them. Details are under
          http://www.reliancelife.com/contact-us.aspx

          • Sir,
            Thanks for Quick response .
            You are right in my case option is ” Life “.

            Option I
            I have not received any amount from them till date.

            Option II
            There was no fund valve problem.

            I have visited company office as per them the policy is in lapse since last month Jan 2015 and not possible to continue any more for them. They requested to collect the cheque.

            If I collect cheque,
            Will it get added in my income and need to pay tax on it as per my slab.

            If it tax me than and also the examption taken in first three need to be reverse then what I earn from last six year.

            Sir, Is it assesse fault.

            Saroj.

          • In case of Unit Linked plans, if you surrender your policy before completion of five policy years, surrender value will be added to your income and taxed as per applicable slab rate. Apart from this, the deduction claimed under Section 80C during previous years will be reversed and you will have to pay tax on it as well. However if you surrender after payment of five year premiums, there will be no tax on the surrender value.

  16. R/Sir,
    Myself Arvind worked in delhi govt.school
    Mujhe meri beti ki reimbursement of tuition fees k department se 1500×12=18000 Rs. Per year Milhe h jb ki m school m tuition fees k 5848×12=70176 Rs.+ Admission fees 10800 Rs. Total Rs.70176+10800=80976 deposit krwata hu

    My DEDUCTION UNDER 80C only CPF- 48000
    Agar mujhe department se reimbursement of tuition fees Rs.18000 milhe h aur m apni beti k school m tuition fees k Rs.80976 deposit krwata hu toh mujhe deduction under 80C TUITION FEE Rs.80976 ka benefit mil sakta h
    Please inform me

    • Hi Arvind,

      You can claim the full tuition fees as part of 80C. (but only the amount written as tuition fees in the school receipt)

    • I have bought resale apartment in Dec 2014 and missed to claim tax benefits on registration and stamp duty. Can I claim them in FY 2015-16 (assessment year 16-17)?

  17. Hi Vivek,

    You have said that avoid ULIP saying “There are other investment options which can yeild the same results at a lower cost.”
    Could you please tell them?

  18. Hi sir,

    can you please tell me Prepayment of housing loan can be considered under 80c ?
    Apart form paying regular EMIs to the bank, I made a prepayment of 3lacs.
    can this amount be considered under 80c ?

  19. Dear Sir,
    Reg Home loan i have a query. Husband and wife as a co-applicant has purchased a house thru home loan. Can Husband alone claim the entire principal and interest paid clubbing the wife’s portion also by taking a letter from wife that she is not claiming her portion and husband can claim both their share as she does not have any income. Is it valid.

    Also under Sec 80d if the receipt is issued in the name of wife , can the husband claim the deduction for mediclaim.

    Thanks
    Ravichandran, Chennai
    9790713322

    • 1) When you are co-applicants, you can claim the interest & principal upto the max limit allowed.
      2) For mediclaim deduction, you can claim only if the premium is paid by you.

  20. Sir,

    If a home loan is taken over by another bank with additional funds given as top up and the amount settled to the previous bank fully can that be taken as pre-payment and can that be claimed under 80c for the maximum benefit.

    Thanks
    Ravichandran

    • Hi Ravi,

      Normally, if you make genuine pre-payment of home loan, you can claim deduction u/s 80C . However, in this case it is not prepayment, but a
      balance transfer of existing loan, so you cannot claim deduction.

  21. sajeevan chalapron

    Is ULIP admissible for SPOUSE’s 80C deduction

    • An individual may purchase a ULIP in his own name, or for spouse or any child. Child may be married or unmarried, dependent or independent, minor or major – all these investments shall qualify for deduction under Section 80C

  22. Sir, I have opened an NPS in the name of my wife whoes payment was done by me. My wife is dependant on me. Can I take 80C tax benefit on the investment done by me in the name of wife.

    • Hi Ayan,

      You cannot claim tax deduction for money invested in wife’s NPS. Only she can claim tax benefit.

      Contribution by individual employee is eligible for a deduction from Income under Section 80CCD (1) of the Income Tax Act 1961 upto Rs 1.5 Lakhs. However, investments under Section 80C Section 80CCC and 80CCD(1) should not exceed Rs.1.5 lakhs per assessment year to claim for the deduction.

      An additional exclusive tax benefit of Rs.50,000/- under section 80DD(1B) per assessment year (applicable from FY 2015-16/AY 2016-17) for NPS investments.

  23. hii

    I have taken a tax saving FD of 50000 last year. Can I show it as a investment under 80C for the rest of the 5 years also?? Or is that investment only for that financial year only?

  24. Hello Sir,

    if i get NSC from post office on my wife’s name ,can i claim that under 80C?

    • Hi Utkarsh,

      When you invest in NSC only for yourself or behalf of minor. So technically you cannot invest in spouse name.
      you should invest in NSC in Joint name and invest your money.

      Relevant – Circular No. 405, F. No. 178/1/84-IT(AII), dated January 15, 1985]

  25. hi sir,
    i bought a new car, whether the car insurance is applicable for 80 c

  26. Sir,
    I have not recd your reply.

  27. sir,
    Can deduction be claimed for electricity bill and maintenance bill paid to society
    for self occupied house by a non-working sr citizen? If so, then under which section of IT.
    Pl inform.

    • For the self occupied property, you cannot claim any Standard deduction. As the annual value of self occupied property is ZERO, there is no Standard deduction allowed.

  28. Hi vivek
    I want to know whether individual members of HUF can get the benefit u/s 80c if payment has been made through the bank account of the HUF.

  29. Hi,

    I have got a residential plot registered in my name via gift deed from my Dad in this year. I have already started construction with a Home Loan from SBI. Also, the plot is now mortgaged to SBI. The construction will be completed in next financial year and loan repayment starts soon after providing completion certificate OR Feb 2016, whichever is earlier. Request you to address my queries –
    1. Will the stamp duty and registration fee of this gift deed or mortgage, whcih I had paid in this financial year, be eligible for tax deduction u/s 80c ?
    2. Since my first installment of loan is already disbursed, can I get the tax exemption for the interest paid until the end of this financial year (March 2015) in this year itself?

    • 1) You can only claim stamp duty & registration charges in the year of possession. Also these charges should be for property (not gift deed etc)
      2) You can claim the interest only in the year of possession. Previous interest can be claimed in 5 equal installments.

  30. 5 yrs Fix deposit in Bank is name of my son who is minor (2 months old) and he is dependent, can i claim this Fix deposit under 80C. please suggest under which act.

    • 80C deduction can only be claimed if investment is done in 5 Year Tax Saving FD and you are the first holder of that FD.

  31. Hi,
    Vivek
    I wanted to invest in Canara HSBC grow smart plan for 10 years with the annual premium of 25k. Please suggest me should I invest or not.

    • Canara HSBC Oriental Bank of Commerce Life Insurance Grow Smart Plan is a Whole Life Unit Linked Insurance Plan (ULIP) with Limited Pay option.
      Being a Whole Life Plan, there is no Maturity Benefit. Thus, whenever the Life Insured dies, the higher of the Sum Assured or the Fund Value would be paid to the nominee as the Death Benefit and the policy would be terminated.

      As in case of ULIPs, the premium allocation charges are high (5.4% – 8.4% every year)

      It will be advisable to 1) take a term plan life insurance 2) invest the balance amount in investments like Mutual funds, PPF etc . You will get better insurance and better returns by this strategy.

  32. Sir,

    Can I claim 80c exemption for ELSS/SIP (HDFC Mutual Fund) investment made in my wife’s name.

  33. If I applied for 5 year Tax Saver Fixed Deposit of Rs 1 Lakh on 2014.

    Will the same FD can applicable for Tax Exemption on the following 5 financial years (2015,2016,2017,2018)

    • you can claim deduction for that FD only in the year of investment. You cannot claim it for all 5 years.

      However, for claiming in other years, you need to make investment again in those years.

  34. Sir, I wanted to know more about some long term fixed deposit scheme like 10 years or more for my daughter’s future education. Which will be the best plan which perfectly suits to in my situation ???

    • Hi, What you want to know about long term FD? You can go with any large bank to get the 10 year FD investment.
      What exactly is your query.

  35. Hi Vivek,

    The registration charges incurred while purchasing a flat in May 2013 has been in excess of the permissible(available) limit in FY 13-14. Whether this difference can be claimed now in current financial year ending March 2015.

    Please let me know ASAP 🙂

    Regards,
    Ravi

  36. Hi,

    The LIC policy is in the name of husband and wife pays the premium.

    Can wife can claim deduction u/s 80C

    Regards
    Ravi

  37. Hi Vivek,

    I have an query with regard to the Insurance premium.

    I have an Insurance policy but my wife pays the premium. can she claim 80C deduction.

    regards
    BC Ravi

  38. Hi Vivek,
    I am an NRI. I need to invest to get benefit under 80C.I have NRO acount in ICICI bank. Just to confirm Can I do tax saver FD of ICICI bank (5yrs) and show that to get benefit under 80C?

    Please let me know.

    Thanks

  39. Hi Vivek,
    You are doing a great job clarifying all doubts.
    Me and my wife both own a flat. So when we sell the flat before holding 3 yrs, the short term capital gain will be equally divided between us for taxation?
    E.g: we bought the flat at 60lacs and we sold it 1yr after registration(possesion) for 80lacs. So the total shirt term capital gain of 80-60=20 lacs will be split between us equally for 10 lacs each. So we need to pay tax on 10 lacs as per the tax slab separately.

    We dont have any other income in india as we are NRIs.

    Thanks

  40. What Will Be The Tax Treatment On Maturity Of Future Plus Policy?
    Original Invested – 30000
    Matured Amount – 48950

    • Hi Hemal,

      When did you take the LIC Future Plus Policy and whether you are surrendering it ? How long have you kept this policy?

  41. what are the investment option available to HUF u/s 80C

    • HUF can claim deduction u/s 80C for the following:

      Tax Saving Fixed Deposits
      Life Insurance Premium for any Member of HUF
      Tax Saving Mutual fund
      Stamp Duty and Registration Charges on purchase of a House
      Children Tuition Fees for any Member of HUF
      Repayment of Principal amount of Home Loan

      There are some more as well.

  42. Sir, How much is exempt in case of Leave Encashment at the time of VRS by Public Sector Undertaking employee.

    • For Government employee – Leave encashment at the time of retirement / leaving job is fully exempt from tax under section 10(10AA)(i)

      For non-Government employee, Leave encashment will be exempt for amount (least of following)

      •Rs 3,00,000.
      •Actual Leave encashment amount that has been received by an employee.
      •10 months’ Salary.
      •Cash (salary) equivalent of leaves that is available at the time of retirement

  43. Thank you Vivek for your prompt reply.

    My query is as under:

    A flat on resale was bought in May 2013 incurring stamp duty and registration charges of 1.6lacs. As the ceiling under 80C for year ending 31 March 2014 was 1lac, this entire amount could not be claimed as there were others like LIC payments etc also. The unclaimed portion as on date is approx 80000. Please clarify whether this difference amount can be claimed under 80C in this financial year ending 31 march 2015.

    I may also add that possession has been taken in May 2013 itself.

    • Hi Ravi,

      The deduction regarding the stamp duty and registration can only be claimed in the year of payment.
      Also, you are eligible to claim deduction only if the construction of the property is completed and you have possession of the house.

      • SIR,
        I HAVE A QUERY REG. THE DEDUCTION OF THE STAMP DUTY & REGISTRATION.
        WHETHER ITS APPLICABLE FOR HOUSE ONLY OR LAND ALSO???????

        AS I HAVE GIVEN 26,000 RS AS STAMP DUTY & REGISTRATN FOR A LAND.
        CAN I CLAIM DEDUCTION UNDER 80C??

        PLZ HELP.

  44. Dear Sir,

    I have paid the PPF amount for the month of APril , may and June 2014 in the month of March 2014.

    Please let me know that weather it is eligible for exemption in the year 2013-14 or 2014-15.

    • PPF deduction can be claimed only in the year in which it is invested. If you have invested in March 2014, then you can claim it in FY 13-14 (AY 14-15)

  45. Dear sir
    Can I invest in sukanya sammridhi a/c of my girl child from HUF and claim under 80 c of HUF invome

  46. Hi Vivek,

    I am paying Rs. 10000 Home rent , will it be applicable for tax exemption?
    Also my son is in playgroup since this Apr 15, I paid Rs. 15000 for that, will it be useful for tax exemption?

    • Hi Rakesh, Do you receive HRA?
      If you receive HRA , you can claim for HRA deduction
      If you dont receive HRA, you can claim deduction u/s 80GG . As per Section 80GG, you can claim
      1) Rent paid minus 10 % the adjusted total income.
      2) Rs 2,000 per month.
      3) 25 % of the adjusted total income.

      You cannot claim the payment for playgroup. However, you can claim only if the amount paid is for tuition fees.

  47. Hi Team,

    Is 5Year fixed deposit comes under ‘TERM DEPOSIT UNDER SECTION 80C’ contribution/investment.

    Because in my office portal am confused under which contribution/investment tab declaration needs to be done.

    • yes 5 year tax saving FD will qualify as TERM DEPOSIT UNDER SECTION 80C. Note that it should be 5 year Tax saver FD and not just normal FD for 5 years.

  48. Hi Vivek,

    I’m new investor in MF ,age 26 and

    1.little bit confusion regarding when to invest in ELSS with respect to market watch.Can you suggest me when we need to invest while market price low or high?.

    2.I want to invest in ELSS for next 10-25 years.My monthly income is 45k and want to save taxation.Also I have future planning for children education and marriage.So please suggest ELSS schemes to invest 10k per month.

    • Hi Vikram,

      Every investor would like to invest when prices are low. but because of market sentiment at that time, people will think that it will go lower and keep waiting.

      If you are investing for long term and investing systematically, you should not bother much about the current market levels. You cannot time the market always.

      2)You can consider following ELSS funds:
      Axis Long Term Equity Fund (G)
      Reliance Tax Saver (ELSS) (G)
      BNP Paribas Long Term Equity (G)

      http://wealth18.com/best-elss-tax-saving-mutual-funds-for-investment-in-2014/

  49. What are the proofs to be submitted to claim Registration and Stamp Duty Charges? Please advise.

    • No documents need to be submitted with the Income tax returns. However, you should keep the supporting receipts in case your return comes under scrutiny.

  50. Dear sir,
    I have recently purchased an under construction flat on my and my wife’s name. The stamp duty and registration has been done on both of our names. I have taken the home loan on my name and not included my wife’s name in home loan.
    Can we both show the stamp duty registration cost (250000/-) under our 80c sections, or is it valid to declare only for me?

    Thanks in advance and best luck !

    Regards,
    Uday

    • Hi Uday, You can only claim the registration cost for completed residential property. Also, normally registration is done at the time of possession.
      If paid at possession, you both can claim 50% each.

      • Hi Vivek,
        Many thanks for your prompt response.

        We have already paid registration cost (30000/-) as well as stamp duty of (240000/-) and the possession is around December 2015.
        If we get the possession on december 2015 we both can claim 135000/- each under 80c sections.

        Please correct if my understanding is wrong.

        Thanks again !

        Regards,
        Uday.

  51. Sir,
    I want to know if we keep FD in my daughter’s name ( she is 18 yrs old) if the FD fetch Rs. 10000/- + interest then, bank will deduct TDS? my husband comes under 10% tax slab and me comes under below taxable category. kindly advice, how to avoid TDS/Tax.

    And also i would like to know whether pension is taxable or no? whether pension amount has to be declared in IT returns?

    Please reply,

    regards,

    • 1) If your daughter is 18+ years, then the FD interest will be treated as her income. if the Interest is more than Rs 10000 in a year, TDS @10% is deducted (if PAN is updated). If PAN is not updated in the account, then TDS @20% is deducted.

      If her total income is below taxable limit, then she can submit Form 15G to the bank and no TDS will be deducted.

      2) Regarding Pension – please give more details. Who receive the pension – after death or within lifeline? whether employer was private / government etc.

  52. Hi Vivek,

    1 year FD and 5 year FD, if interest earned is more than Rs.10000 then interest earned on both is taxable, then what is the benefit in 5 yr Bank FD.

  53. I am having a doubt regarding tax saving through elss
    Suppose if I invest 5000 every month in elss through sip for 3 years, I will get 60000 tax benefit for first year. So wether i will get the benefit of 60000 for 2nd as well as 60000 for 3rd year also or is it for 1st initial year only

    • Hi Yogesh,

      Yes you will get the benefit in 2nd & 3rd year as well. as you are investing Rs 60000 each year.

      • Thank u for d reply
        I have one more doubt that while investing in ELSS through SIP wether we will get 50% tax benefit or 100% of the amount invested

        • Whatever amount you invest in ELSS (total SIP amount in that year) , you can claim deduction under Section 80C. Note that total limit under 80C is Rs 1.50 lakhs (including all other eligible investments).

  54. sir, if i invest 5 lakhs in nsc 10 years, then in this fy i can claim 80c deduction for rs 150000, in next years does interest on 5 lakhs amount come under section 80c or not for claiming interest deductions i.e. full interest on 5 lakhs under 80c

  55. Thanks Vivek ji, for ur prompt reply, in my earlier question I forgot to mention that I want to buy Rs 5 lakhs Nsc 10 years in same fy 15-16.

    Thus it means that in coming years I have to show interest gained on Rs 5 lakhs Nsc under income from other sources and the same interest can be further deducted under Sec 80c. Thus the deduction in Ay 16 -17 shall be max Rs 150000, but from further Ay 17-18 and further I can claim full interest deduction under Sec 80c. kindly clarify if I am right.

    • Hi Ajay,

      1) Yes, in AY 2016-2017, you can claim deduction upto Rs 1.5 lakh u/s 80C for your NSC investment
      2) From AY 17-18, you can claim NSC interest as deduction u/s 80C (upto max o f Rs 1.5 lakhs). Assuming interest on Rs 5 lakh NSC is Rs 40000, you can claim full amount.

  56. Thanks, Vivek ji for ur prompt responce.

    In my earlier que i had forgotten to write that i want to invest Rs 5 lakhs in Nsc (10 yrs ) in this fy 15-16. Thus in Ay 16-17, while filing IT return i shall claim deduction of Rs 1.5 lakhs, Now this Ay shall be counted as Zero Year, so should i include interest for balance 3.5 lakhs under income from other sources, and then claim the interest of 3.5 lakhs under Sec 80c, or the whole interest of Rs 5 lakhs invested in fy 15-16, filed in Ay 16-17 be counted as zero year, and from Ay 17-18 onwards i should first include full interest of Rs 5 lakhs under income from other sources and then cancel that interest under sec 80c and this i can continue till 9th year. Kindly clarify this.

    Thanks a lot.

    • Hi ajay,

      1) for invest in NSC in FY 2015-2016, you can claim 80C benefit when filing return for AY 2016-2017.
      2) Every year, total NSC interest on full amount) need to be shown as Income and can claim deduction u/s 80C

  57. If i am taking FD for more than 5 years will it considered under 80c ?

    • Hi Sairam, No, not all FD for 5 years will be considered u/s 80C. You need to invest specifically in 80C Tax saver FD as it has lockin.

  58. Hello Sir,

    I am a salaried person under 20% tax slabs. I wish to save tax under 80C, by investing some money (Rs. 30000) on my spouse’s name, who is a housewife.

    Please let me know, which will be the best option for the investment?

  59. Thakur Lalachand Bhatia

    M wife had taken fd u/s 80c gfor locck in period of 5 years.I am jt holder.After about one and half years she has expired. Can I now prematurely close this fd.what will be i.tax reurcussions

    • Hi As you are the joint holder, the FD amount will be payable only on maturity. But you need to submit the death certificate to the bank now, so that mode of holding can be changed.

  60. Hi vivek,
    I have purchased rs.300000(three lacs) nsc in the joint b scheme. Will i get deduction under 80c?

  61. hi
    this is sakir hussain . i just would like to know incentive that i am getting apart from my salaries is also taxable .because my company is deducting 20 % on incentive also . and one more thing if it taxable so i think one amendment came that on incentive it is deducted 5 % .
    please tell me about it ..

    thanks
    sakir hussain
    email:hussainsakir37@gmail.com

    • Hi Sakir, there is no such separate tax slab for incentives. The Allowances are taxable at normal rates depend on the type of allowance. In your salary slip or contract – how this “incentive” is shown – as what kind of allowance.
      If it is just “Other Allowance” , then it is taxable at normal rates.

  62. sir, I am a pensioner and my total pension comes to over 3,50,000 and i intend to claim exe,ption under s.80C by deposits in PPF. I can make the deposits all through the financial year – i.e., in instalments from april to March and so i may not be ablle to provide proof of such deposits at the beginning of the year. Is issufficient to give a declaration to the bank disbursing my pension showing the amount i intend to deposit for the exemption art the beginning of the year as the proof of deposit is not available at that time. If I can, please inform me the relevant instruction ofthe IT dept. Vinoba

    • Hi Vinoba,

      You need to file return in July next year. So all PPF amount between April to March would have been invested.

      There is no proof required to be submitted with Income tax return form.

  63. Hi,

    I have a query regarding FD for tax exemption.
    FD issued by Co-operative Society/ Banks are eligible for tax exemption ?

  64. Dear Vivek,

    Have one question for my father who is a senior citizen. As he is retired (and not having form 16), I would like to know where can he submit proofs for 80c deductions. He wants to show his investments and update it while filing the ITR. While salaried people submit proofs to their employers, where can senior citizens submit the proofs and can they update the relevant 80c amount in the ITR form.
    Thank you.

    • Hi Vinay, There is no need to submit the proofs when filing the returns. You can keep it with you and it may be required if any assessment / scruitny is done.

  65. Dear Sir,

    One of my friend working for a software firm worked April to Dec in UK and returned to India.In UK tax has been deducted and p 45 form is also issued. Income considered includes indian salary whilst in UK.

    In india for the period Jan to March taxes have been deducted fORM 16 issued which includes unclaimed porion of reimbursible allowances for the full year.

    In my opinion he is an NRI, can he claim relief of foreign tax credit u/s 90/91 for taxes paid in UK. pl clarify as early as possible.
    Regards. Thanks in advance.

    • Hi Ramani,
      Hi Ramani, It depends on various question as follows:

      How many days he was out of India in Fy 2015-2016. Did he go to UK for employment with UK company?
      Prior to this, was he always in India in previous year.

  66. If Grandfather/Grandmother of student paid tuition fees than will it be possible for a Grandfather/Grandmother to claim deduction for tuition fees U/s 80c

  67. hi,
    can I submit my IT return for the financial year 2008-09 now i.e., in 2016 and claim refund on TDS of Rs 2699 deducted by my employer under sec 192 (salary) for employees provident fund

    Also can I claim refund on TDS of Rs 1077 under sec-194 A ( int other than int on securities)deducted by my bank

    my total income in both cases does not fall under Income tax

  68. Hi Team,

    if I make an FD of 50k for 5 years lock period.
    Can I show this 50k for next five years under 80c?

  69. Hi,

    I am a new tax payer. If I invest money in FD/any other tax saving scheme in the month of March 2016, can I claim tax deduction in same year i.e 2015-2016

    • Hi Rupesh, When you invest in March 2016, you can claim it in FY 2015-2016 (AY 2016-2017) return which was due in Jul 2016.

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