Section 80C is one of the most popular tax-saving sections under the Income Tax Act, 1961. It allows individuals and HUFs to claim deductions up to ₹1.5 lakh per year on specified investments and expenses. This directly reduces your taxable income and helps lower your tax liability — but only if you opt for the old tax regime.
In the new tax regime (default from AY 2024-25), Section 80C deductions are not available. As of November 2025, there is no change in the 80C limit or list for Assessment Year 2025-26 (Financial Year 2024-25).
Read this complete guide to know the full list of eligible deductions, limits, conditions, and how to maximize your savings!
Table of Contents
- What is Section 80C Deduction?
- Maximum Limit Under Section 80C for AY 2025-26
- Who Can Claim Section 80C Deductions?
- Is Section 80C Available in New Tax Regime?
- Complete List of Section 80C Deductions 2025-26
- Popular Section 80C Investment Options (Table)
- How to Claim 80C Deduction While Filing ITR
- Important Conditions & Lock-in Periods
- Tax Saving Example Under Old Regime
- FAQ – Section 80C Deductions AY 2025-26
What is Section 80C Deduction? {what-is-section-80c}
Section 80C allows you to reduce your taxable income by investing in government-approved schemes or incurring certain expenses. The combined deduction under 80C + 80CCC + 80CCD(1) is capped at ₹1.5 lakh. Additional ₹50,000 can be claimed under 80CCD(1B) for NPS (total possible ₹2 lakh).
Maximum Limit Under Section 80C for AY 2025-26 {limit}
- ₹1,50,000 per financial year (no change in Budget 2024 or 2025 updates till date).
- Investments/expenses made between 1st April 2024 to 31st March 2025 are eligible for AY 2025-26.
Who Can Claim Section 80C Deductions? {eligibility}
- Individuals & Hindu Undivided Families (HUFs)
- Both Resident and Non-Resident Indians
- Not available for companies, firms, or partnership businesses
Is Section 80C Available in New Tax Regime? {new-vs-old}
No. If you choose the new (default) tax regime, you cannot claim 80C deductions.
Quick Comparison (AY 2025-26):
| Particulars | Old Tax Regime | New Tax Regime |
|---|---|---|
| Section 80C Deduction | Yes (up to ₹1.5 lakh) | No |
| Standard Deduction | ₹50,000 | ₹75,000 |
| HRA Exemption | Yes | No |
| Best For | High deductions/investments | Low/no deductions |
Related Article: Old vs New Tax Regime Comparison AY 2025-26
Complete List of Section 80C Deductions 2025-26 {list}
Here is the full updated list of eligible investments & expenses:
- Life Insurance Premium (LIC or any approved insurer) – For self, spouse, or children
- Public Provident Fund (PPF)
- Employee Provident Fund (EPF) – Employee's contribution only
- Equity Linked Savings Scheme (ELSS Mutual Funds) – 3-year lock-in
- National Savings Certificate (NSC)
- Tax-Saving Fixed Deposits (5-year FD) in banks/post office
- Senior Citizens Savings Scheme (SCSS)
- Sukanya Samriddhi Yojana (SSY) – For girl child
- Principal Repayment of Home Loan
- Tuition Fees for up to 2 children (full-time education in India)
- National Pension System (NPS) – Employee contribution (under 80CCD(1), within 80C limit)
- Unit Linked Insurance Plans (ULIPs)
- Infrastructure Bonds (if notified)
- Post Office Time Deposits (5-year)
- Contribution to Recognized Provident Funds/Superannuation Funds
Popular Section 80C Investment Options (Table) {table}
| Investment/Expense | Lock-in Period | Approx. Returns | Risk Level | Best For |
|---|---|---|---|---|
| ELSS Mutual Funds | 3 years | 12-15% (market linked) | High | Growth + shortest lock-in |
| Public Provident Fund (PPF) | 15 years | 7.1% (2025) | Low | Safe long-term |
| Tax-Saver FD | 5 years | 6-7.5% | Low | Guaranteed returns |
| Life Insurance (Traditional) | 3-5 years | 4-6% | Low | Protection + savings |
| National Savings Certificate | 5 years | 7.7% (2025) | Low | Safe & simple |
| Sukanya Samriddhi Yojana | Till girl turns 21 | 8.2% (2025) | Low | Girl child future |
(Returns as per latest rates Nov 2025 – subject to change quarterly)
Related Article: Best Tax Saving Investments Under 80C 2025
How to Claim 80C Deduction While Filing ITR {#claim}
- Collect proofs (receipts, certificates)
- If salaried – Submit to employer for Form 16
- While filing ITR (old regime) – Enter details in Schedule VI-A
- For ITR-1/ITR-4 – Mandatory detailed disclosure of each investment
Important Conditions & Lock-in Periods {conditions}
- Investments must be in your own name (or spouse/children for insurance/tuition)
- Premature withdrawal may reverse the deduction + attract penalty
- Tuition fees – Only fees, not donation/development fees
- Home loan principal – Only for residential property
Tax Saving Example Under Old Regime {example}
Mr. Rahul (age 32) has gross income ₹12 lakh.
- Salary: ₹12,00,000
- Standard Deduction: – ₹50,000
- Section 80C Investments: – ₹1,50,000 (ELSS + PPF + Insurance)
- Additional 80CCD(1B) NPS: – ₹50,000
Taxable Income = ₹12L – ₹50K – ₹1.5L – ₹50K = ₹8.6 lakh Tax Saved ≈ ₹46,800 (30% slab)
Related Article: How to Calculate Income Tax AY 2025-26
FAQ – Section 80C Deductions AY 2025-26 {faq}
Q1. What is the last date to invest for 80C in AY 2025-26? A. 31st March 2025 (for FY 2024-25).
Q2. Can I claim 80C if I missed submitting proof to employer? A. Yes! Claim directly while filing ITR.
Q3. Is home loan principal eligible under 80C? A. Yes, but interest goes under Section 24(b) up to ₹2 lakh.
Q4. Can I invest after 31st March and still claim? A. No, except for some cases like insurance premium paid by April 30 for previous year (not applicable now).
Q5. Is ELSS better than PPF for 80C? A. ELSS has only 3-year lock-in and higher returns potential, but market risk.
Q6. What if I switch to new tax regime next year? A. You lose 80C benefit, but lock-in continues for investments already made.
