Income Tax Deductions and Exemptions for F.Y 2018-19

When Filing income tax returns for F.Y 2018-19, you must know your rights about  Tax deductions and exemptions. So you can get benefits and can save you tax. 
Income tax, tax deductions
Tax deduction means tax reduction in tax obligations from gross taxable income. Tax deduction varies in amount because different incomes are treated differently under various sections of the Income Tax Act. It will help reduce the overall tax liabilities and aids you save tax. An income tax can be claimed for the amount spent in charitable contribution, tuitions fees, medical expenses, housing loan. You can get tax deductions from investments like retirement saving schemes, life insurance plans, and national saving schemes etc.

Summarise Income Tax deductions under section 80C to 80U


Sections
Allowed limit (Maximum)
Type of investment, income or Expenses
80C
Maximum Rs.1,50,000 (overall of 80C, 80CCC and 80CCD)
LIC Premium, NSC, Bank FD’s, EPF, PPF, tuition fees
80CCC
Maximum Rs.1,50,000 (overall of 80C, 80CCC and 80CCD)
Pension funds
80CCD
Maximum Rs.1,50,000 (overall of 80C, 80CCC and 80CCD)
Pension fund initiated by the central government
80TTA
Up to Rs.10,000 (per year)
Bank saving account interest
80CCG
50% of the amount invested (maximum 25,000)
Equity saving schemes
80CCF
Up to Rs.20,000
Long term infrastructure bonds
80D
For individual taxpayers:
Individual premium up to 25,000
Senior citizen- premium up to 30,000
For HUFs:
Premium up to Rs.25,000
Senior citizen: Premium up to 30,000
Medical insurance premium and Health check up
80E
There is not any limitation defined by the government
Interest on repayment of education loan
80EE
Maximum Rs. 50,000
Interest on the loan payable for residential house property
80G
Differs with the amount of the donation
General Donation of any valid society
80GGA
Depends on the quantum of donation
Donation to scientific Research or Rural Development
80GGB
Depends on Quantum of donation
Political part donation
80GG
Rs. 5,000 per month or 25% of total income ( in both condition lowest is calculate for deduction)
Rent paid (if HRA is not received)

The following list of Income Tax deductions for F.Y 2018-19


Income tax deductions under section 80C
                                                   

The taxpayer can claim deductions of a maximum amount up to Rs. 1.5 lakh per year.  (Up to 1.5 lakh deductions include section 80C, 80CCC and 80CCD). This tax benefit is most beneficial for salaried employees of the private sector and the government sector.
Investment in FD
→ Interest earned on fixed deposits with tenure of greater or equal to five years.
→ Tax exempted interest income on deposits is less than Rs. 50,000.
Investment in PPF
→ Maximum investment can eligible- 1.5 lakh in a year
→ Withdrawal is tax-free
Investment in NSC
→ Full form of NSC: National Saving Certificate
→ The deduction is eligible for in the year they purchased
→ Interest accrued on such certificate is eligible for tax deduction each year (Taxable at the time of maturity)
Life insurance premium
→ It considers for Life insurance payments of spouse, self or children
Mutual fund Investment
→ Can claim a deduction on investment in any unit of mutual funds, it is not necessary whether listed on a stock exchange or not
 Housing loan
→ Can claim tax deductions on the principal amount paid for a home loan
Tuition Fees
→ For deductions must pay tuition fee by cheque
→ Maximum two children fee is eligible
Payment for construction and buying of residential property

Tax deductions under Section 80CCC & 80CCD

→ Up to 10% of basic plus DA of the contribution made by your employer is eligible for deductions.
→ A self-employed individual can’t claim these income deductions
→ Up to Rs. 50,000 can claim deduction qualified for National Pension System

Section 80TTA: Saving Account Interest

→ Interest earned on a savings bank account can claim deduction maximum amount of Rs. 10,000.

Section 80CCF: Deductions for Investment made in long term infrastructure bonds

→ Long term infrastructure bonds notified by a government is eligible for deduction claim up to 20,000

Section 80CCG: Deductions for an investment made under a Rajiv Gandhi Equity Saving Schemes

→ Claim up to 25,000 on listed shares or mutual funds

Section 80D: Deduction for payment of medical insurance and health check-up

→ You can claim a tax deduction under this section for the payment of medical insurance premium for self, child or spouse.
→ A deduction can claim up to 25,000.

Section 80E: Deduction for interest on education loan

→ A deduction can be claimed for interest paid on repayment of a loan

Section 80EE: Deduction for interest payments on loan taken for acquisition of a residential property

→ In this section can be claim maximum 50,000

Section 80G: Deduction for Donation

→ To deduction donation amount, donation paid in form of cheque/cash/ Draft
→ Up to 2,000 donation is eligible for a reduction, in case if you pay donation more than 2,000, you have to pay by cheque or Drafts

Section 80GGA: Deduction for Scientific Research Donation

→ 100% deduction claim for Scientific Research Donation: Example If you paid donation I financial year Rs 10,000, then fully amount deductible from total income.
→ A deduction is available in respect of payment made during the F.Y for the following Institution:
Scientific Research Association, university, colleges etc.

Section 80GGB & 80GGB: Tax deduction on the contribution by Companies to Political Parties

→ No cash payment is allowed, Payment made through cheques, demand draft, direct transfer in the account of the respective political parties are allowed.

Section 80DD & 80U: Deduction for Disability                

→ Following disabilities that are covered under section 80DD & 80U: Low vision, Blindness, Leprosy-cured, Locomotor disability, Hearing impairment, Mental illness, Mental retardation.
→ Deduction u/s 80DD:
1.    Disability – Rs. 75,000
2.    Severely Disability – Rs. 1,25,000
→ Deduction u/s 80U:
1.    Disability – Rs. 75,000
2.    Severely Disability – Rs. 1,25,000
Note: Disability means that an individual has a minimum 40% of any disability from the allotted list and several disabilities mean that an individual has a minimum of 80% or more the allotted disabilities.
→ Section 80DD is provision for spouse or children and Section 80U is provision for Taxpayer self.

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