Every person who earns more income than the basic exemption limit in a Financial Year has to pay taxes to meet the liability due to the Income Tax Department. Paying a huge amount to the authorities from your hard-earned money can be quite a discouraging task for taxpayers. Therefore, the government pays out several kinds of exemptions and deductions to taxpayers so that they can be encouraged and feel motivated while paying taxes. However, it is not much surprising that you do not know about the tax deductions you could claim. If you are also forward to learning more about the existing deductions and exemptions, you have landed on the right platform at TaxDunia.
Types of Income Tax Deductions in 2025
- Section 80C: deduction & exemption on investments and only individuals and HUF can claim up to Rs 1.5 lakhs every year. Companies, partnership firms and Partnership Firm/LLP Return are not allowed for this deduction
- Section 80CCC: deductions on investments on paymet made towards pension schemes. Deduction can go up to Rs 1.5 lakhs for such investments
- Section 80CCD(1): deductions for contribution in NPS notified by the government. Employed person can claim deductions maximum to 10% of basic salary and DA while self employed 20% of gross total income
- Section 80D: deduction on medical insurance premium and expenses for senior citizens and preventive health check ups
- Section 80E: interest on education loan is allowed to individuals who has taken education loan for higher education. But it is allowable on one condition that the loans are used for the taxpayer’s spouse, children, or a student to whom the taxpayers is legal guardian
These are the most popular tax deductions which most taxpayers are aware of but apart from the above mentioned deductions, there are multiple other deductions which are provided to the taxpayers under various section of the Income Tax Act, 1961. You may or may not know about these deductions. The following are some of the most uncommon benefits and section related to them.
- Section 80TTA: interest on savings accounts
- Section 80TTB: interest from deposits held by senior citizens
- Section 80GG: income tax deduction on house rent aid
- Section 80EE: interest on home loan for first time home owners
- Section 80DD: deduction for medical treatment of a dependent with disability
- Section 80U: dedcution for disabled individuals
Tax Savings under Sections of Income Tax Act
Under section 80TTA, taxpayers get deductions on interest on savings account. An individual or HUF can claim deductions up to a maximum of Rs 10,000. While under section 80TTB, income tax deductions are allowed on interest from deposits held by senior citizens. Senior citizens aged 60 or above can claim a maximum of Rs 10,000 as deductions.
Section 80GG of the Income Tax Act, allows taxpayers to claim income tax deductions on house rent aid and those who do not get any HRA in their salary structure but lives on rented accommodation can claim deductions. These are subject to prescribed limits though.
Under section 80EE, deductions are allowed to the first time home owners. The deductions are allowed to individuals having only one house property on the date of the sanction of the loan. Under section 80DD, taxpayers can claim deductions on medical treatment of a dependent with disability. The benefits are allowed to resident individual and HUF and expenditure incurred on medical treamtnet, training and rehabilitation of specially-abled dependent relative is covered.
Section 80U of the income tax act deals with the allowable deductions for disabled indivudals. These are available to resident individuals suffering from a physical disability including blindness or mental retardation and they can claim up to Rs 75,000. In case of severe disability, the deductions go up to Rs 1.2 lakhs.
Tax savings under the Income Tax Act are possible through various sections like 80C, 80D, and 24(b). Section 80C allows deductions up to ₹1.5 lakh on investments like PPF and ELSS. Section 80D provides deductions on health insurance premiums, while Section 24(b) offers relief on home loan interest. These provisions help reduce taxable income effectively.
Get Started with TaxDunia
Apart from the deductions as mentioned in the article, there are other several yet specific deductions which taxpayers do not know weather they could claim it or not. These deductions help in reducing overall tax liability of taxpayers and it makes them eligible for legally save the taxes. The criteria of benefits differ from companies to individuals as individuals are given more options to reduce their liability while companies or business have limited scope. Therefore reaching out to a tax professional who have wide knowledge of income tax and its provisions would be highly recommended. Taking services from an expert would ensure that your savings are optimized and you are compliant with tax laws and rules.
