Section 80C
The Income Tax Act provision allowing a deduction for specified investments and payments, capped at ₹1.5 lakh a year.
Formula
Tax Saved = Amount Invested (up to ₹1.5 lakh) x Applicable Marginal Tax Rate
Unit
₹
In depth
Section 80C covers a wide set of options including the public provident fund, employee provident fund contributions, life insurance premiums, principal repayment on a home loan, tuition fees and equity-linked savings schemes. The ₹1.5 lakh cap applies to all of them combined, so provident fund contributions and home loan principal frequently consume most of it before any deliberate investment is made. Crucially the deduction is available only under the old tax regime, so anyone on the new regime receives nothing for these investments. That makes the regime choice the first decision, not the investment choice.
Worked example
A ₹1,50,000 investment at a 30% marginal rate plus cess saves about ₹46,800 under the old regime. Under the new regime the same investment saves nothing, and any lock-in attached to it still applies.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Section 80C” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.