under 80C not only reduces tax liability, but also saves the property buyer from further cash outgo. Also, an individual who has taken a home loan can avail of deduction towards principal repayment in the financial year. This will be above the R1.5-lakh rebate he gets on the interest amount paid towards the housing loan under Section 24. More importantly, even principal payment towards home loans taken from HUDCO qualifies for exemption under 80C. Also, subscription to the home loan account scheme of the National Housing Bank (NHB), or contributions made by an individual to any notified pension fund set up by NHB, also meet the deduction requirements.
Section 80CCC allows salaried individuals deduction of the amount paid or deposited out of their income to keep in force a contract for any annuity plan of LIC or any other insurer for receiving pension from the fund referred to in Section 10 (23AAB). However, the deduction shall exclude interest or bonus accrued or credited to the employee's account. Also, Section 80CCD(I) allows an employee, being an individual employed by the central government on or after January 1, 2014, a deduction of the amount paid or deposited out of his income. However, the deduction will not exceed an amount equal to 10% of his salary, which includes dearness allowance but excludes all other allowances and perquisites. Another provision eligible for exemption under Section 80C is money paid towards fixed-deposit schemes of HUDCO or other housing boards constituted for the purpose of planning, development or improvement of cities or towns.
Under Section 80CCG, a new retail investor can put money in Rajiv Gandhi Equity Savings Scheme (RGESS). Here, one can invest in one or more financial years in a block of three consecutive financial years beginning with the initial year in which the deduction has to be claimed. This tax exemption is available over and above the exemption available under 80C. The investor has the choice to invest in shares of BSE 100 or CNX 100, stocks of public sector enterprises, units of exchange-traded funds and MFs. A new retail investor with gross income of up to R12 lakh can avail of benefits under this scheme, with a permissible investment of R50,000. The exemption is available for R25,000, i.e., 50% of the invested amount.
Moreover, 80C also offers some market-linked investment options, such as equity-linked savings schemes (ELSS) and unit-linked insurance plans (Ulips). ELSS investments, which