If you’re a taxpayer in India and following the old tax regime, Section 80C continues to be one of the most powerful tools to reduce your income tax burden—offering deductions up to ₹1.5 lakh on eligible investments and expenses.
But for Financial Year 2024–25 (Assessment Year 2025–26), there are some important changes that you need to know before filing your Income Tax Return (ITR). This guide will break down what has changed, what remains the same, and how to claim your deductions correctly.
- Quick Snapshot
- Who Can Claim 80C Deduction?
- What’s New in FY 2024–25?
- Disclosure Requirements
- Where to Fill These?
- Why This Change?
- List of Popular 80 C Eligible Investments (No Changes Here)
- Step-by-Step: How to Claim Deduction u/s 80-C Correctly in FY 2024–25
- Coming Soon: Clause 123 (Proposed in Income Tax Bill 2025)
- What Could Change?
- Common Mistakes to Avoid
- Frequently Asked Questions (FAQs)
Quick Snapshot
| Aspect | FY 2024-25 Update |
|---|---|
| Maximum Deduction Limit | Rs. 1,50,000 |
| Investment Disclosure | Mandatory (Policy / Account Details) |
| Applicable Regime | Only Old Tax Regime |
| Pre-filled Data | Maybe introduced in the future |
| Proposed Clause 123 | Applicable from Assessment Year 2026-27 |
Who Can Claim 80C Deduction?
| Eligible Persons | Ineligible Persons |
|---|---|
| Individual taxpayers (both Indian residents and NRIs) | Companies |
| Hindu Undivided Families (HUFs) | Limited Liability Partnerships |
| Partnership Firms |
What’s New in FY 2024–25?
The Income Tax Department now requires mandatory disclosures for each 80C investment when filing your return of income. This applies if you are using ITR-1 or ITR-4 under the old tax regime.
Note: As on the date of this article, ITR 2 and ITR 3 are yet to be notified for the Assessment Year 2025-26
Disclosure Requirements
For each investment under 80C, you must mention:
- Name of the investment (e.g., PPF, ELSS, LIC)
- Policy or account number
- Amount invested
- Name of the institution or payee
- Document or receipt reference number
Where to Fill These?
All this goes under “Schedule VI-A” in your ITR form.
Why This Change?
- To prevent fake deduction claims
- To match your details with PAN-linked records from LICs, mutual funds, and banks
- To pave the way for pre-filled ITR forms in the future
List of Popular 80 C Eligible Investments (No Changes Here)
| Investment Options | Minimum Lock-in Period |
|---|---|
| Public Provident Fund (PPF) | 15 years |
| Employees’ Provident Fund (EPF) | Until retirement/resignation |
| Equity-Linked Saving Scheme (ELSS) | 3 years |
| National Savings Certificate (NSC) | 5 years |
| 5-Year Tax Saving FD | 5 years |
| Life Insurance Premiums | 2-5 years depending on policy |
| Sukanya Samriddhi Yojana | Until girl turns 21 |
| Senior Citizens Savings Scheme (SCSS) | 5 years |
| ULIP | 5 years |
| Children’s Tuition Fees | NA (per academic year) |
Total Deduction Limits Under Section 80C and Related Sections
| Section | Nature of Investment | Maximum Limit (₹) |
|---|---|---|
| 80C | PPF, ELSS, LIC, Tuition Fees, NSC, etc. | ₹1,50,000 |
| 80CCC | Annuity Plans (e.g., LIC pension plan) | ₹1,50,000 |
| 80CCD(1) | NPS Contributions (Self) | 10% of salary (employed) / 20% of income (self-employed) |
| 80CCE | Combined limit for 80C, 80CCC, 80CCD(1) | ₹1,50,000 |
| 80CCD(1B) | Additional Deduction for NPS | ₹50,000 |
| 80CCD(2) | Employer’s NPS Contribution | Up to 10–14% of salary (no upper cap within limit) |
Effective Total Limit (Including 80CCD(1B)): ₹2,00,000
Step-by-Step: How to Claim Deduction u/s 80-C Correctly in FY 2024–25
- Choose the Right Tax Regime
- Old Regime → Eligible for 80 C
- New Regime → 80 C NOT allowed
- Collect Proofs
- Life Insurance (LIC) Premium Receipts
- Equity Linked Savings Scheme (ELSS) Statements
- Public Provident Fund (PPF) Passbook Entries
- Fixed Deposits (FD) Receipts, etc.
- Log in to ITR Portal or Utility
- Open ITR-1 or ITR-4
- Go to Schedule VI-A
- Enter the Investment Details
- Investment Name, Amount, Policy/Account No., Date, Reference No.
- Double-Check Entries
- Inaccuracies may lead to notices or denial of claims
- E-Verify Return
- Using Aadhaar OTP or other available methods
Coming Soon: Clause 123 (Proposed in Income Tax Bill 2025)
From AY 2026–27, Section 80C may be restructured into Clause 123.
🔗Visit out Income Tax Bill Section for more updates on the upcoming New Income Tax Act
What Could Change?
- Unified structure for deductions
- Streamlined list of eligible investments
- Simplified tax forms
Note: These changes are proposed and will NOT affect filings for FY 2024–25.
Common Mistakes to Avoid
- Using 80 C under the new tax regime
- Skipping account or policy numbers in ITR
- Claiming without valid proofs
- Missing ITR Schedule VI-A details
Frequently Asked Questions (FAQs)
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