A comprehensive list of frequently asked questions on Tax Saving Investments in India. Quick and Easy reference for Income Tax Savings Investments frequently asked questions (FAQ) including 80C, 80CCC, 80CCD(1), 80CCD(1b), 80CCD(2), 80D, 80DD, 80U, 80DDB, 80E, 80G, 80GGA, 80GGB, 80GGC, 80GG
Deduction is limited to whole of the amount paid or deposited subject to a maximum of Rs. 1,50,000. This maximum limit of Rs. 1,50,000 is the aggregate of the deduction that may be claimed under sections 80C, 80CCC and 80CCD.
Below is the updated Health Insurance Limits for AY 2020-21 and would be same for AY 2021-22
|Description||Medical Insurance Premium paid in respect of||Total Deduction under Sec. 80D|
|Self, Spouse & Dependent Children||Parents (whether dependent or not)|
|No-one has attained the age of 60 years||Rs. 30,000||Rs. 30,000||Rs. 50,000|
|Assessee and his family is less than 60 years & parents are above 60 years of age||Rs. 30,000||Rs. 50,000||Rs. 75,000|
|Assessee and his parents have attained the age of 60 years and above||Rs. 50,000||Rs. 50,000||Rs. 1,00,000|
Three types of donations in general
1. Charity donations: Donations paid to specified institutions qualify for tax deduction under section 80G but is subject to certain ceiling limits. Based on limits, we can broadly divide all eligible donations under section 80G into four categories:
1a. Donations with 100% deduction without any qualifying limit:
1b. Donations with 50% deduction without any qualifying limit:
1c. Donations to the following are eligible for 100% deduction subject to 10% of adjusted gross total income:
1d. Donations to the following are eligible for 50% deduction subject to 10% of adjusted gross total income:
Qualifying Limit: The qualifying limits u/s 80G is 10% of the adjusted gross total income. The limit is to be applied to the adjusted gross total income. The adjusted gross total income’ for this purpose is the gross total income (i.e. the sub total of income under various heads) reduced by the following:
2. Donation to scientific research:
Any assessee who does not have income chargeable under the head “Profits and gains of business or profession” can claim deduction under Section 80GGA. Hence, salaried employees who do not have business income can claim deduction under the section. However, employers while calculating TDS on salary cannot consider deduction under Section 80GGA. Salaried employees can submit information on contributions under Section 80GGA to the Income Tax department while filing their return and seek a tax refund, if applicable.
3. Donation to political Party: If you have contributed any amount to a recognised political party, you are eligible to claim a tax deduction ranging from 50 percent to 100 percent of the amount under Section 80GGC for individuals and Section GGB for corporate organisations. One can contribute up to 10 percent of one’s gross total income to a political party.
80GGC. In computing the total income of an assessee, being any person, except local authority and every artificial juridical person wholly or partly funded by the Government, there shall be deducted any amount of contribution made by him, in the previous year, to a political party or an electoral trust.
Explanation:—For the purposes of sections 80GGB and 80GGC, “political party” means a political party registered under section 29A of the Representation of the People Act, 1951 (43 of 1951)
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