Section 80C

Section 80C of the Income Tax Act, 1961 allows Indian resident individuals and HUFs to deduct up to ₹1.5 lakh per financial year from taxable income for a defined list of investments and expenses. It is the single most widely claimed deduction in the old tax regime and has shaped the savings culture of an entire generation of Indian earners.

Eligible items include EPF contribution, PPF deposits, ELSS mutual funds, life-insurance premiums (self/spouse/children), home-loan principal repayment, tuition fees for up to two children, Sukanya Samriddhi Yojana, NSC, 5-year tax-saving bank FDs, and NPS Tier-1 employee contribution. The ₹1.5 lakh cap is combined across all of these — you cannot stack. At a 30% marginal rate, fully using 80C saves ₹45,000 in tax every year.

Critically, Section 80C is available only if you opt for the old tax regime. Under the new regime (default from FY 2023-24), 80C plus HRA, LTA, 80D, and most other chapter-VI-A deductions are disallowed in exchange for lower slab rates. The break-even depends on your rent and existing 80C commitments.

Pair our income tax and HRA calculators to compare old vs new regime liability with and without your full 80C — the answer often flips at around ₹10–12 lakh income.