Section 80C Deductions: Complete List for AY 2026-27
By GSRC and Associates, Chartered Accountants
What Is Section 80C?
Section 80C of the Income Tax Act, 1961, allows individuals and HUFs to claim deductions from gross total income for specified investments and expenditures. The combined ceiling under Sections 80C + 80CCC + 80CCD(1) is ₹1.5 lakh per financial year.
An additional deduction of ₹50,000 is available under Section 80CCD(1B) for contributions to the National Pension System (NPS), over and above the ₹1.5 lakh limit.
Complete List of 80C-Eligible Investments & Payments
Market-Linked Investments
| Investment | Lock-in | Notes |
|---|---|---|
| ELSS Mutual Funds | 3 years | Shortest lock-in; returns market-linked; gains up to ₹1 lakh tax-free per year |
| Unit-Linked Insurance Plans (ULIPs) | 5 years | Life cover + investment; maturity proceeds may be taxable if premium > ₹2.5L/year (post Mar 2023) |
Fixed / Guaranteed Return Instruments
| Investment | Lock-in | Interest / Return |
|---|---|---|
| Public Provident Fund (PPF) | 15 years | 7.1% p.a. (Q3 FY26); interest and maturity tax-free (EEE) |
| Employee Provident Fund (EPF) | Till retirement | 8.25% p.a. (FY25); employee contribution deductible |
| Voluntary Provident Fund (VPF) | Till retirement | Same as EPF; additional voluntary contribution by employee |
| National Savings Certificate (NSC) | 5 years | 7.7% p.a. (Q3 FY26); interest taxable but re-invested interest also qualifies for 80C |
| Sukanya Samriddhi Yojana (SSY) | Till girl turns 21 | 8.2% p.a. (Q3 FY26); EEE status; parents can open for girl child below 10 years |
| Senior Citizens Savings Scheme (SCSS) | 5 years | 8.2% p.a.; for persons 60+; max deposit ₹30 lakh |
| Post Office Time Deposit (5-year) | 5 years | 7.5% p.a.; only 5-year TD qualifies for 80C |
| Tax-Saver Fixed Deposits (Banks) | 5 years | Rates vary (6.5–7.5%); premature withdrawal not allowed; interest taxable |
Insurance Premiums
- Life Insurance Premium — for self, spouse and children. Policy must be in force. Annual premium must not exceed 10% of Sum Assured (pre-2012 policies: 20%).
- Pension Plans from LIC and other insurers — deductible under 80CCC (sub-limit within the ₹1.5L ceiling).
Payments That Qualify
- Home Loan Principal Repayment — EMI principal portion to any bank / NBFC / housing finance company for self-occupied or let-out property. Stamp duty and registration charges also qualify in the year of payment.
- Children's Tuition Fees — School / college fees for up to 2 children (your own biological or legally adopted). Development fees, transport and donation do not qualify.
NPS — Extra ₹50,000 Under 80CCD(1B)
National Pension System contributions qualify both under 80C (within ₹1.5L) and separately under 80CCD(1B) for an additional ₹50,000. So a taxpayer who maximises NPS can deduct up to ₹2 lakh in total (₹1.5L + ₹50K).
Practical Tips to Maximise 80C
- Do not over-invest in one product — Mix PPF (EEE, guaranteed) + ELSS (higher growth potential) for a balanced approach.
- Count EPF first — Your mandatory PF contribution already counts towards the ₹1.5L limit. Check before making additional investments.
- Home loan principal — If you are repaying a home loan, the principal portion likely eats into your 80C limit. Check your loan amortisation schedule.
- File on time — Investments made up to 31 March count for that financial year. Do not wait until the last week — processing delays can affect proofs.
80C Does Not Apply in the New Tax Regime
If you have opted for the New Tax Regime (which is now the default), Section 80C deductions are not available. However, you still get the enhanced standard deduction of ₹75,000 and the 87A rebate of ₹25,000. Our CA team will calculate whether the old or new regime results in lower tax for your income profile.
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