Under Section 80C of the Income Tax Act, 1961, individual taxpayers and Hindu Undivided Families (HUFs) are eligible to claim deductions for certain investments and expenses up to a maximum limit of Rs. 1.5 lakh per financial year. The deductions under Section 80C are aimed at encouraging taxpayers to save and invest for their long-term financial goals. Here are the key eligibility criteria for claiming deductions under Section 80C:

  1. Individual Taxpayers: Resident individuals, whether salaried, self-employed, or professionals, are eligible to claim deductions under Section 80C.
  2. Hindu Undivided Families (HUFs): HUFs, which are separate tax entities consisting of family members, can also avail of the benefits under Section 80C.
  3. Investments and Expenses: The following are some of the eligible investments and expenses that qualify for deductions under Section 80C:

a. Life Insurance Premiums: Premiums paid towards life insurance policies for self, spouse, and children are eligible for deduction.

b. Public Provident Fund (PPF): Contributions made to PPF accounts in the name of the taxpayer or family members are eligible for deduction.

c. Employee Provident Fund (EPF): Contributions made by salaried employees to EPF through their employers qualify for deduction.

d. Equity-Linked Saving Schemes (ELSS): Investments made in ELSS mutual funds, which are tax-saving mutual funds with a lock-in period of three years, are eligible for deduction.

e. National Savings Certificate (NSC): Investments in NSC are eligible for deduction.

f. Senior Citizens Savings Scheme (SCSS): Investments in SCSS are eligible for deduction for individuals aged 60 years or above.

g. Tax-saving Fixed Deposits: Investments made in tax-saving fixed deposits with specified banks are eligible for deduction.

h. Tuition Fees: Deduction can be claimed on tuition fees paid for up to two children for their education in any school, college, university, or educational institution within India.

  1. Aggregate Limit: The maximum deduction that can be claimed under Section 80C is Rs. 1.5 lakh per financial year. This means the total amount of investments and expenses eligible for deduction cannot exceed this limit.

It's important to note that the deductions under Section 80C are subject to specific terms and conditions, and not all investments and expenses are eligible for the deduction. Additionally, taxpayers should ensure that they meet the necessary requirements and provide appropriate documentary evidence to claim the deductions while filing their income tax returns.

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