Chapter Via Deductions

Chapter VIA under Income tax provisions provided deductions for assessee from his income. Deductions are provided based on investments/payments made, income and in certain other cases.

Following are some of the major Chapter VIA deductions through which taxes can be saved:

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Investment/payment Based Deductions

Section – 80C: Deduction in respect of life insurance premium & certain investments

80C allows deduction for investment made in PPF, EPF, LIC premium , Equity linked saving scheme, principal amount payment towards home loan, stamp duty and registration charges for purchase of property, Sukanya smriddhi yojana (SSY) , National saving certificate (NSC) , Senior citizen savings scheme (SCSS), ULIP, tax saving FD for 5 years, Infrastructure bonds etc. It allows a maximum deduction of Rs 1.5 lakh every year from the taxpayer’s total income.

Income Based Deductions

Section – 80TTA: Deduction in respect of interest on deposits in savings account

Deduction is available to individual/HUF in respect of interest income from savings account with a bank, co-operative society, or post office up to Rs 10,000.

Other Deductions

Section – 80JJAA: Deduction in respect of employment of new employees

Sec 80JJAA allows deduction of 30% on incremental and additional employee cost for employees having total emoluments of Rs.25,000 or less for a period of 3 years. This deduction is available to assessee to whom tax audit u/s 44AB applies. It must be noted that deductions can be claimed only if a report by CA certifying the deduction is furnished along with the return of income in form 10DA.