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Deductions under Section 80C for Assessment Year 2020-21 (FY 2019-20)

Deductions under Section 80C for Assessment Year 2020-21 (FY 2019-20)


Public Provident Fund (PPF) 


Employee Provident Fund (EPF)


National Saving Certificate (NSC)


Sukanya Samriddhi Yojana (SSY)


5-year Tax Saving Fixed Deposit


Senior Citizens Savings Scheme (SCSS)


Equity Linked Saving Scheme (ELSS)


National Pension System (NPS)


Life Insurance Premium


Unit Linked Insurance Plans (ULIPs)


Infrastructure Bond 


Repayment towards principal of Home Loan


Children Tuition Fees


Contribution pension plan by insurers 


For taxpayers at the highest tax bracket of 30%, the cumulative tax savings under Section 80C works to Rs 46,800 (including cess) when they utilise the entire Rs 1.5 lakh limit under this section. This is a very attractive way to reduce tax outgo and encourages taxpayers to use this savings route to suit their circumstances and convenience. 

Another popular and useful opportunity to save income tax is through contributions that qualify for deductions under Section 80D towards medical insurance. Under Section 80D, taxpayers can claim a deduction of Rs 25,000 on premium paid towards medical insurance for self, spouse and dependent children. For taxpayers at the highest tax bracket of 30%, the cumulative tax savings under Section 80C works to Rs 46,800 (including cess) when they utilise the entire Rs 1.5 lakh limit under this section. This is a very attractive way to reduce tax outgo and encourages taxpayers to use this savings route to suit their circumstances and convenience. 


An additional deduction for medical insurance of parents is available up to Rs 25,000, if they are less than 60 years of age. And, if parents are senior citizens, the deduction is Rs 50,000. This section also allows deduction towards preventive health check-up for maximum Rs 5,000 each year, as long as it is within the prescribed limits for taxpayers based on their age.

There are several other ways to claim tax deductions subject to conditions that need to be satisfied to exercise such tax reduction. For instance, under Section 80E, expenses on higher education fetch you tax deductions when the higher education is supported by education loan. Under Section 80E, the interest paid on the loan can reduce your taxes subject to conditions to avail the benefit.

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