Key idea
The most-used tax break in India: up to ₹1.5 lakh of certain investments and expenses, deductible under the old regime.
Section 80C lets you reduce your taxable income by up to ₹1,50,000 a year, if you put money into (or spend it on) any of a defined list of options. It is available only under the old regime, and it is a big reason many people stay with that regime.
What counts toward the ₹1.5 lakh
| Instrument | Note |
|---|---|
| EPF (your own contribution) | Already happening via salary |
| PPF | Long-term, tax-free |
| ELSS mutual funds | Equity, 3-year lock-in |
| Life insurance premium | Term or traditional |
| Home-loan principal repaid | The principal part of EMI |
| Children's tuition fees | Two children |
| 5-year tax-saver FD, NSC | Fixed-return options |
The trap to avoid
The ₹1.5 lakh is a combined ceiling, not a limit per option. Your EPF contribution alone often fills a large part of it before you invest anything extra, so check what is already being used before adding more.
80C mixes very different things (equity, fixed returns, insurance, loan repayment) under one cap. They are not equally useful; the cap decides how much is deductible, not what belongs in your plan. Figures for FY 2026-27. The Budget can change them each year, so confirm the current year.
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