Income tax deduction U/s 80C With Automated Income Tax Revised Form 16 Part B for F.Y.2020-21 & A.Y.2021-22 as per Budget 2020( New Tax Regime and Old Tax Regime U/s 115BAC)
In chapter VIA of the income tax act, 1961, the most widely used option to save tax is section 80C. This section allows an individual and HUF to save tax by investing in or spend on certain specified avenues. The maximum limit up to which you can claim tax deduction under section 80C is Rs 1,50,000 for the financial year 2018-19 and 2019-20.
In this article, we will discuss certain expenses which are allowed as a deduction under section 80C before calculating tax payable on your taxable income. Before discussing please note, you can claim a deduction only when you have spent money during the previous year on listed expenses.
By claiming tax deduction of up to Rs 1,50,000, you reduce your taxable income by which you will be required to pay less or zero tax. For instance if your gross total income for the financial year 2019-20 is Rs 6,50,000 and you have invested or spent money during the year on specified avenues, then after taking deduction as per your eligibility you can reduce your total taxable income to Rs 5,00,000. In such a case, you will not be liable to pay tax as you will be eligible for a tax rebate of Rs 12,500 under section 87A.
Tuition fees for children
Tuition fee paid for children qualifies for tax benefit under section 80C of the IT Act, 1961 within the overall limit of Rs 1,50,000.
Tuition fee that is paid at the time of admission or anytime during the financial year to any registered university, college, school or educational institution based in India qualifies for section 80C tax deduction. It can be a private or government institution.
However, please note only full-time education including any play school activities, pre-nursery and nursery classes are eligible. Tuition fee paid for part-time courses is not eligible for a tax deduction.
Section 80C restricted the deduction for tuition fee to two children per individual. This means you can claim a tax deduction only up to two children. But if both husband and wife are paying tuition fee for their the child then each of them will be eligible up to 2 children each.
Section 80C restricted the deduction for tuition fee to two children per individual. This means you can claim a tax deduction only up to two children. But if both husband and wife are paying tuition fee for their the child then each of them will be eligible up to 2 children each.
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