Has Section 80C tax deduction limit been hiked in Budget 2024?
deduction under Section 80C has not been hiked by the finance minister in Budget 2024. An individual will be able to claim deduction of up to only Rs 1.5 lakh under this section in a financial year provided he/she opts for the old tax regime in a financial year. The new tax regime does not allow Section 80C deduction.
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The income tax laws allow an individual to claim a deduction of up to Rs 1.5 lakh from the gross taxable income provided he/she makes specified investments and expenditures in the relevant financial year.
Who is eligible to claim deduction under Section 80C?
The income tax laws allow an individual (including an NRI) and a Hindu Undivided Family (HUF) to claim deduction under the Section. However, companies, and partnership firms are not allowed to claim Section 80C deduction.
How much tax is saved due to Section 80C deduction?
Section 80C deduction of up to Rs 1.5 lakh from gross taxable income can save income tax up to Rs 46,800 (inclusive of cess at 4%) in cases where the income is taxable at 30%. The amount of tax saved depends on the tax rate to which the income was subject to i.e. less would be saved if income was taxable at 20% or 5% in cases where the person's income was in lower tax slabs.
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