Missed Income Tax Deductions: Sections 80C, 80D & More
Many taxpayers end up paying more income tax than necessary because they forget or are unaware of valuable deductions. Under Chapter VI-A of the Income Tax Act, these deductions lower taxable income and can significantly increase refunds. Let’s explore the most common deductions, why they’re missed, and how to claim them.
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What Are Income Tax Deductions?
Income tax deductions are specific expenses or investments allowed by law to reduce taxable income. They reward savings, investments, or expenses that benefit society—like health insurance, education, and donations.
Overview of Chapter VI-A Deductions
Chapter VI-A covers a range of sections, including 80C, 80D, 80E, and 80G, each with unique limits and qualifying criteria.
Difference Between 80C, 80D, 80E, and Other Sections
80C covers investments and savings like PPF, EPF, and ELSS.
80D allows deductions for health insurance premiums.
80E provides relief on education loan interest.
Others like 80G cover donations and 80TTA/80TTB allow savings interest deductions.
Commonly Missed Deductions
Section 80C – Investments & Contributions
Maximum deduction: ₹1.5 lakh.
Eligible investments: EPF, PPF, ELSS, NSC, life insurance premiums, and five-year tax-saving fixed deposits.
Tip: Start investments early in the financial year to avoid last-minute rush.
Section 80D – Health Insurance Premiums
Deduction up to ₹25,000 for individuals (₹50,000 for senior citizens).
Covers premiums and preventive health check-ups for self, spouse, and dependents.
Section 80E – Education Loan Interest
Entire interest on education loans for higher studies is deductible for up to eight years.
Principal repayment is not covered, only the interest portion.
Other Important Sections
80G: Donations to approved charities.
80GG: Rent deduction for non-salaried individuals.
80TTA/80TTB: Savings account interest (₹10,000 for individuals, ₹50,000 for senior citizens).
Why Deductions Go Unclaimed
Lack of Awareness
Many taxpayers know only about 80C and miss lesser-known deductions like 80E or 80GG.
Forgetting to Submit Proofs on Time
Failing to submit investment proofs to employers before the cutoff date often results in higher TDS.
Changes in Income or Job
Switching jobs mid-year or receiving unexpected income can lead to missed deductions if not updated.
How to Claim Missed Deductions
Filing a Revised Income Tax Return (ITR)
If you forget to claim deductions, you can file a revised return before the end of the relevant assessment year.
Submitting Proofs After the Deadline
Even if you missed the employer’s deadline, you can still claim deductions while filing your ITR directly.
Adjustments in the Next Year
For recurring deductions like ELSS or PPF, ensure contributions continue and are claimed in the next financial year.
Benefits of Claiming All Eligible Deductions
Lower Tax Liability
Properly claimed deductions can move you to a lower tax slab, reducing tax outgo.
Higher Refunds
Accurate claims ensure any excess TDS deducted is refunded quickly.
Full Legal Compliance
Claiming eligible deductions keeps you aligned with the Income Tax Act and reduces the risk of scrutiny.
Practical Tips to Maximize Deductions
Plan Investments Early: Don’t wait until March—spread contributions across the year.
Maintain Digital Records: Store insurance receipts, tuition fees, and donation receipts securely.
Use the AIS & Form 26AS: Reconcile these statements with your ITR to avoid mismatches.
Seek Professional Advice: A tax consultant can highlight lesser-known deductions.
Conclusion
Missing tax deductions can lead to unnecessary tax payments and lower refunds. By understanding sections like 80C, 80D, 80E, and 80G, keeping proofs ready, and filing accurately, you can optimise your tax liability and stay compliant.
I am a Chartered Accountant with 5 years of experience specializing in GST, income tax, and HSN code classification. I help businesses with GST compliance, tax planning, and financial advisory, ensuring they meet regulatory requirements while optimizing their tax strategies. I aim to simplify GST filings, income tax laws, and HSN code classifications, helping professionals and business owners stay informed and compliant.
Frequently Asked Questions
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What happens if I miss claiming 80C deductions?
You can claim them by filing a revised return before the assessment year ends, ensuring proper proof is attached.
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Can I claim 80D deductions after filing ITR?
Yes, by submitting a revised return within the permitted timeline, you can claim health insurance premium deductions.
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Are there limits on unclaimed deductions?
Yes, each section has specific limits: ₹1.5 lakh for 80C, ₹25,000–₹50,000 for 80D, etc.
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How long can I revise my tax return to include missed deductions?
You can revise your return until December 31 of the assessment year or before assessment completion, whichever is earlier. -
Do I need to submit all proofs again when revising?
Yes, keep digital and physical copies of investment proofs and upload them if required during verification.
