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Difference between 80C vs 80CCD
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Difference between 80C vs 80CCD: Section 80C and 80CCD of the Income Tax Act, 1961 offer tax deductions to individuals on specific investments in financial instruments.
Under Section 80C, individuals can claim a deduction of up to Rs. 1.5 lakh for investments in various financial instruments such as PPF, ELSS, NPS, life insurance premiums, and home loan principal repayment.
On the other hand, Section 80CCD provides an additional deduction for investments made in the NPS by both employees and self-employed individuals. Employees can claim an extra deduction of up to 10% of their salary (basic + DA), while self-employed individuals can claim up to 20% of their gross income as a deduction.
Difference between 80C vs 80CCD: The key distinction between Section 80C and 80CCD is that while Section 80C covers a range of specified investments and expenses, Section 80CCD specifically focuses on investments in the NPS. Additionally, the maximum deduction limit under Section 80C is Rs. 1.5 lakh, whereas the limit under Section 80CCD is based on the NPS contribution.
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It is important to note that the combined deduction limit under Section 80C and 80CCD cannot exceed Rs. 2 lakh. Furthermore, the tax deductions provided by these sections are subject to certain conditions and limitations. Individuals are advised to consult a tax professional or refer to the Income Tax Act for comprehensive information on eligibility and calculation of deductions.
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