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Deductions

Income Tax Act 2025 - Section Changes​

Mapping of old sections (IT Act 1961) to new sections (IT Act 2025)

EXEMPTION​

IT Act 1961IT Act 2025Description
Section 10(5)Section 11 (Sch III (8))Travel concession or assistance (LTA/LTC)
Section 10(10)Section 19 (1)(3)Death-cum-retirement gratuity exemption
Section 10(10A)Section 19 (1)(7)Commuted value of pension exemption
Section 10(10AA)Section 19 (1)(14)Leave encashment on retirement
Section 10(10B)Section 19 (1)(10)Retrenchment compensation
Section 10(13)Section 11 (Sch II (8))Approved superannuation fund
Section 10(13A)Section 11 (Sch III (11))House rent allowance (HRA)
Section 10(14)Section 11 (Sch III (12))Special allowances
Section 10Section 11Total exemption

DEDUCTION​

IT Act 1961IT Act 2025Description
Section 16(ia)Section 19 (1)(2)Standard deduction
Section 16(iii)Section 19 (1)(1)Professional tax
Section 24Section 22Housing loan interest
Section 80CSection 123Investments (PPF, ELSS, etc.)
Section 80CCCSection 123Pension funds
Section 80CCD(1)Section 124 (5)NPS contribution
Section 80CCD(1B)Section 124 (3)Additional NPS ₹50,000
Section 80CCD(2)Section 124 (1)Employer NPS
Section 80CCESection 123₹1.5 lakh aggregate limit
Section 80CCHSection 125Agnipath Scheme
Section 80DSection 126Health insurance
Section 80DDSection 127Dependent disability
Section 80DDBSection 128Specified diseases
Section 80ESection 129Education loan interest
Section 80EESection 130Home loan interest (affordable)
Section 80EEASection 131Housing loan
Section 80EEBSection 132—
Section 80GSection 133Donations
Section 80GGSection 134Rent without HRA
Section 80GGASection 135Scientific research donations
Section 80GGCSection 137Political contributions
Section 80TTASection 153 (2)(a)Savings interest (₹10k)
Section 80TTBSection 153 (2)(b)Senior citizen interest (₹50k)
Section 80USection 154Disability deduction
Chapter VI-AChapter VIIIOther deductions

REGIME / REBATE​

IT Act 1961IT Act 2025Description
Section 115BACSection 202New tax regime
Section 87ASection 156Tax rebate
Section 89Section 157Relief for arrears

TDS​

IT Act 1961IT Act 2025Description
Section 192Section 392TDS on salary
Section 192(2B)Section 392(4)Other income declaration
Section 194PSection 392(8)Senior citizen TDS exemption
Section 197Section 395Lower TDS certificate
Section 234ESection 427Late fee for TDS

FORMS​

IT Act 1961IT Act 2025Description
Form 16Form 130TDS certificate
Form 24QForm 143Quarterly TDS return
Form 12BBForm 124Employee declaration

Deduction U/S 10 - HRA​

HRA Calculator​

TDS on rent​

Why 11 Months?​

By keeping the lease duration to 11 months, landlords can ensure that the regulations of the Rent Control Act do not apply to their agreement. This allows for greater flexibility in dictating the terms of the lease, including the rent and the tenure of the lease.

Most rental agreements in India are 11 months long because it allows landlords to avoid the Rent Control Act's regulations, which can restrict the terms of the lease. This gives landlords more flexibility to specify the lease's terms, including the rent and the length of the lease. The agreements are typically renewed every 11 months, which gives both parties the opportunity to revise the terms as per their convenience.

An 11-month lease agreement also allows the landlord to set the rent based on the current market scenario. The parties involved don't need to pay any stamp duty and registration charges for an 11-month rent agreement. They can also easily renew such agreements using stamp duty paper of Rs. 100 when deciding to extend the rental contract.

However, the agreement doesn't have to be for 11 months. Renewable/extendable agreements of three to five years can also be made as per the assent of the parties.

Alternatively, the landlord and the tenant may mutually agree to not get the agreement registered, which can help them avoid paying the stamp duty and registration fee.

Why Most Lease Agreements are for 11 Months in India?

Others​

  • Sec 80D - Medical Insurance Premium (If the policy covers a senior citizen then exemption is Rs.50,000/-) for self and family- Existing or new policy bought between April 2019 till March 2020.
  • Medical Insurance 80D for Parents (Here you can claim the amount upto maximum of Rs 25,000 per annum for the premiums paid for your parents. If your parents are senior citizens, the amount is increased to Rs 30,000 per annum. You can also claim preventive health check-up amount of Rs 5,000 for your parents too.)
  • Sec 80DD - Handicapped Dependent (Medical Treatment on handicapped dependent, Copies of medical bills and duly completed Form 10-IA have to be submitted.)
    • Rs 75,000 (Starting from the financial year 2015-16) where disability is more than 40% and less than 80%.
    • Rs 1,25,000 (Starting fromthe financialyear 2015-16) where disability is more than 80%.
    • These deductions are allowed irrespective of your actual expenditure.
  • Sec 80E - Repayment of Loan for higher education (only Interest)
  • Sec 80GG - Rent Paid
  • Sec 80U - Handicapped

New Draft IT Rules​

Big Hikes in Exemptions in Old Tax Regime

  • HRA: Cities like Bengaluru, Hyderabad, Pune & Ahmedabad on list for 50% HRA exemption
  • Education Allowance: Exemption per child rises to Rs 3,000 a month
  • Hostel Allowance: Exemption jumps from Rs 300 to Rs 9,000 per month
  • Meal Exemption: Meal vouchers go from token low levels to Rs 200/meal to Rs 1 lakh/year

Sec 80TTA / 80TTB - Interest on saving a/c (upto 10000)​

  • Exemption upto 10,000 for interest earned in savings bank account (less than 60 years) - does not include fixed deposit / RD
  • Exemption upto 50,000 for interest earned for term deposits / RD for age greater than 60 years

https://cleartax.in/s/claiming-deduction-on-interest-under-section-80tta

80DDB - Dependent Critical Illness (upto 1,00,000)​

Section 80DDB of the Income Tax Act allows residents to claim deductions for medical expenses on specified critical illnesses for themselves or dependents (spouse, children, parents, siblings). The maximum deduction is ₹1,00,000 for senior citizen patients (60+) and ₹40,000 for others, reduced by insurance/employer reimbursements.

DEDUCTION U/S 80C (Max 150000)​

  • Contribution to Pension Fund (Jeevan Suraksha)
  • Life Insurance Premium on life of self/spouse/child only
  • Deferred Annuity

Public Provident Fund in own name/spouse/child only​

  • ULIP of UTI/LIC in own name or spouse and child only
  • Repayment of Housing Loan (Only principal)
  • Contribution to Pension Fund or UTI or Notified Mutual Fund
  • Investment in ELSS made in units of Notified Mutual Fund
  • Children Tuition Fee: Restricted to a max of 2 Children
  • Deposit in home loan account scheme of NHB/HDFC
  • 5 yrs. Term deposit in a Sch.Bank
  • DEDUCTION U/S 80CCCAnnuity/Pension Plan
  • DEDUCTION U/S 80CCDNotified Pension Scheme (NPS) (Max 50000)
  • Asset Classes (Equity, Corporate debt, Government Bonds and AlternativeInvestmentFunds)

DEDUCTION U/S 24​

  • Interest on Housing Loan on fully constructed accomodation only (Limit - 200,000)
  • Interest if the loan is taken before 01/04/99 on fully constructed accomodation only (Limit - 30,000)

10(5) LTA​

Tax​

  1. Max - 1.5 lakh

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  • PF - tax free upto 1 lakh

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  • Rent

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17 Best Income Tax Saving Schemes & Plans in 2023

https://www.etmoney.com/blog/beyond-section-80c-10-ways-to-save-taxes

Special allowance​