You would be familiar with Section 80C of Income Tax and its deduction limit if you submit an annual ITR (ITR Return submit). Investments up to Rs 1.5 lakh are eligible for a tax credit under this provision.
Both taxpayers and tax professionals have been calling for an increase in the Section 80C limit for some time now. In addition, in their Pre-Budget 2023 proposal, ICAI recommended that the government raise the limit on PPF deductions under Section 80C from Rs 1.5 million to Rs 3 million.
The ITR due date was July 31st.
The government has resolved the issue of raising the ceiling of 80C now that the deadline for reporting ITR, July 31, has passed. The Finance Ministry has said that increasing the Section 80C exemption ceiling of the Income Tax Act, 1961 is not currently being considered. Currently, under section 80C, taxpayers may deduct up to Rs 1.5 lakh invested annually in tax-advantaged accounts including house loans and life insurance policies.
A proposal to expand the 80C deduction is currently being considered.
PPF, EPF, NSC, NPS, SCSS, 5 year FD in banks and post office, ELSS Mutual Fund, etc. all qualify as tax savings plans for deduction under section 80C. In a written reply to a question in the Lok Sabha on July 31, Union Minister of State in the Ministry of Finance Pankaj Chowdhary said that there is currently no proposal under consideration to expand the exemption under section 80C of the Income Tax Act.
In light of the current economic climate and interest rate situation, the Minister of State for Finance addressed the following question: “Has the government recognised the need to streamline small savings schemes and simplify and enhance exemption under section 80C of the Income Tax Act?” Did that. Six and a half billion income tax returns (ITRs) were submitted in 2023–24, setting a new record.
