Chapter VIII · Sections 123 to 154 (Schedule XV)Direct Tax · Deductions & ExemptionsAct 2025 · Tax Year 2026-27 Ready
Chapter VIII Statutory Deductions & Exemptions Directory
Exhaustive statutory directory of allowable personal, healthcare, startup, and employment deductions cross-referencing Income-tax Act, 2025 Sections 123–154 with legacy Chapter VI-A (80C to 80U) provisions.
Governing Statutory Reference: Chapter VIII (Sections 123, 124, 126, 129, 140, 146, Schedule XV) of Income-tax Act, 2025 / Chapter VI-A of Income-tax Act, 1961.
₹1,50,000
Section 123 (80C Cap)
PPF, EPF, ELSS, Housing
₹1,00,000
Section 126 (80D Health)
Self + Senior Parents
₹50,000 + 14%
Section 124 NPS Tiers
Self Tier + Employer 14%
100% / 30%
Startup & Jobs (80-IAC/JJAA)
Both Regimes Compatible
Statutory Deductions Reference Table
Filter by tax regime compatibility, deduction category, and dual-act statutory sections.
Regime:
| Deduction Nature & Eligible Schemes | Dual-Act Section | Max Statutory Limit | Applicable Regime | Statutory Conditions & Highlights |
|---|---|---|---|---|
Investments & Savings (PPF, EPF, ELSS, Life Insurance, Tuition Fees) Deduction for specified investments including Public Provident Fund, Employee Provident Fund, Equity Linked Saving Schemes, Life Insurance Premiums, Principal Repayment on Housing Loan, and School Tuition Fees. | Section 123 + Schedule XV Section 80C | ₹1,50,000 | Old Regime Only | Includes PPF, EPF, ELSS, Life Insurance, Housing Principal Repayment, 5-Yr Tax Saver FDs, and Tuition Fees. |
National Pension System (NPS) Contributions Additional employee self-contribution up to ₹50,000 under Old Regime; employer contribution up to 14% of salary under Section 124(2) available under Both Regimes. | Section 124 Section 80CCD(1B) / 80CCD(2) | ₹50,000 (Self) + Up to 14% of Salary (Employer) | Specific Provisions | ₹50,000 additional self-contribution under Old Regime; Employer NPS up to 14% of Basic + DA allowable in Both Regimes. |
Health Insurance Premiums & Preventive Health Check-up Deduction for health insurance paid for self, spouse, children (₹25,000 / ₹50,000 if senior citizen) and parents (₹25,000 / ₹50,000 if senior citizen). Includes ₹5,000 preventive health checkup. | Section 126 Section 80D | Up to ₹1,00,000 (₹50,000 self + ₹50,000 senior parents) | Old Regime Only | ₹25,000 for self/family (₹50,000 if senior) + ₹25,000 for parents (₹50,000 if senior). Includes ₹5,000 preventive health checkup. |
Maintenance & Medical Treatment of Disabled Dependent Fixed deduction for medical treatment, nursing, training, and rehabilitation of a dependent with disability (₹75,000 for disability ≥ 40%; ₹1,25,000 for severe disability ≥ 80%). | Section 127 Section 80DD | ₹75,000 / ₹1,25,000 | Old Regime Only | Fixed statutory deduction for maintenance & medical treatment of a dependent with disability. |
Medical Treatment for Specified Critical Diseases Expenditure incurred on medical treatment of specified chronic illnesses (neurological diseases, cancer, chronic renal failure) for self or dependent. | Section 128 Section 80DDB | ₹40,000 (General) / ₹1,00,000 (Senior Citizen) | Old Regime Only | Medical treatment expenditure for specified neurological and chronic critical diseases. |
Interest on Loan for Higher Education Deduction for interest paid on educational loan taken for self, spouse, or children for pursuing higher education. Available for up to 8 consecutive tax years. | Section 129 Section 80E | No Upper Limit (100% of interest paid) | Old Regime Only | 100% of interest paid on loan taken for higher education of self, spouse, or children for up to 8 years. |
Donations to Approved Charitable Funds & Institutions Deduction of 50% or 100% of eligible donations made to registered charitable trusts, relief funds, and government institutions. | Section 133 Section 80G | 100% or 50% of qualifying donation (Subject to 10% adjusted GTI cap) | Old Regime Only | 100% or 50% deduction for donations to approved funds (PM Relief Fund, National Defence Fund, approved NGOs). |
Rent Paid by Individuals Not Receiving HRA Deduction for rent paid for furnished/unfurnished accommodation for self/family when House Rent Allowance (HRA) is not part of salary structure. | Section 135 Section 80GG | Least of: ₹5,00,00/mo (₹60k/yr), 25% of total income, or Rent paid - 10% of total income | Old Regime Only | Rent deduction for salaried/self-employed individuals who do not receive House Rent Allowance (HRA). |
100% Profit Deduction for Eligible DPIIT Startups 100% deduction of profits and gains derived by an eligible startup incorporated after 1-Apr-2016 for 3 consecutive tax years out of 10 years. | Section 140 Section 80-IAC | 100% of Eligible Profits | Both Regimes | 100% deduction of profits for 3 consecutive years out of 10 years for eligible DPIIT recognized startups. |
Deduction for Employment Generation of New Employees 30% additional deduction of employee costs incurred on hiring new regular employees for 3 consecutive tax years. | Section 146 Section 80JJAA | 30% of Additional Employee Cost | Both Regimes | 30% additional deduction of new employee emoluments for 3 consecutive tax years. Available in Both Regimes. |
Interest on Savings Accounts & Senior Citizen Deposits Section 153(1) (Old 80TTA): Up to ₹10,000 savings interest. Section 153(2) (Old 80TTB): Up to ₹50,000 savings and term deposit interest for senior citizens. | Section 153 Section 80TTA / 80TTB | ₹10,000 (General) / ₹50,000 (Senior Citizen) | Old Regime Only | Savings interest up to ₹10,000 (General) or Interest on savings/FD deposits up to ₹50,000 (Senior Citizens). |
Deduction for Persons with Disability Direct flat deduction for a resident individual certified as a person with disability (₹75,000 for disability ≥ 40%; ₹1,25,000 for severe disability ≥ 80%). | Section 154 Section 80U | ₹75,000 / ₹1,25,000 | Old Regime Only | Flat deduction for resident individuals certified with severe disability (≥80%) or normal disability (≥40%). |
Investments & Savings (PPF, EPF, ELSS, Life Insurance, Tuition Fees)
Section 123 + Schedule XVMax Limit: ₹1,50,000
Old Regime OnlyDeduction for specified investments including Public Provident Fund, Employee Provident Fund, Equity Linked Saving Schemes, Life Insurance Premiums, Principal Repayment on Housing Loan, and School Tuition Fees.
National Pension System (NPS) Contributions
Section 124Max Limit: ₹50,000 (Self) + Up to 14% of Salary (Employer)
Specific ProvisionsAdditional employee self-contribution up to ₹50,000 under Old Regime; employer contribution up to 14% of salary under Section 124(2) available under Both Regimes.
Health Insurance Premiums & Preventive Health Check-up
Section 126Max Limit: Up to ₹1,00,000 (₹50,000 self + ₹50,000 senior parents)
Old Regime OnlyDeduction for health insurance paid for self, spouse, children (₹25,000 / ₹50,000 if senior citizen) and parents (₹25,000 / ₹50,000 if senior citizen). Includes ₹5,000 preventive health checkup.
Maintenance & Medical Treatment of Disabled Dependent
Section 127Max Limit: ₹75,000 / ₹1,25,000
Old Regime OnlyFixed deduction for medical treatment, nursing, training, and rehabilitation of a dependent with disability (₹75,000 for disability ≥ 40%; ₹1,25,000 for severe disability ≥ 80%).
Medical Treatment for Specified Critical Diseases
Section 128Max Limit: ₹40,000 (General) / ₹1,00,000 (Senior Citizen)
Old Regime OnlyExpenditure incurred on medical treatment of specified chronic illnesses (neurological diseases, cancer, chronic renal failure) for self or dependent.
Interest on Loan for Higher Education
Section 129Max Limit: No Upper Limit (100% of interest paid)
Old Regime OnlyDeduction for interest paid on educational loan taken for self, spouse, or children for pursuing higher education. Available for up to 8 consecutive tax years.
Donations to Approved Charitable Funds & Institutions
Section 133Max Limit: 100% or 50% of qualifying donation (Subject to 10% adjusted GTI cap)
Old Regime OnlyDeduction of 50% or 100% of eligible donations made to registered charitable trusts, relief funds, and government institutions.
Rent Paid by Individuals Not Receiving HRA
Section 135Max Limit: Least of: ₹5,00,00/mo (₹60k/yr), 25% of total income, or Rent paid - 10% of total income
Old Regime OnlyDeduction for rent paid for furnished/unfurnished accommodation for self/family when House Rent Allowance (HRA) is not part of salary structure.
100% Profit Deduction for Eligible DPIIT Startups
Section 140Max Limit: 100% of Eligible Profits
Both Regimes100% deduction of profits and gains derived by an eligible startup incorporated after 1-Apr-2016 for 3 consecutive tax years out of 10 years.
Deduction for Employment Generation of New Employees
Section 146Max Limit: 30% of Additional Employee Cost
Both Regimes30% additional deduction of employee costs incurred on hiring new regular employees for 3 consecutive tax years.
Interest on Savings Accounts & Senior Citizen Deposits
Section 153Max Limit: ₹10,000 (General) / ₹50,000 (Senior Citizen)
Old Regime OnlySection 153(1) (Old 80TTA): Up to ₹10,000 savings interest. Section 153(2) (Old 80TTB): Up to ₹50,000 savings and term deposit interest for senior citizens.
Deduction for Persons with Disability
Section 154Max Limit: ₹75,000 / ₹1,25,000
Old Regime OnlyDirect flat deduction for a resident individual certified as a person with disability (₹75,000 for disability ≥ 40%; ₹1,25,000 for severe disability ≥ 80%).
Chapter VIII Deductions Optimization & Regime Comparator
Simulate your tax liability under Old Regime with deductions against the Section 202(1) New Regime default ₹12 Lakh rebate.
₹15.00 Lakh per annum
PPF, EPF, ELSS, LIC, Home Loan Principal
Additional NPS Employee Self-Contribution
Self/Family (₹25k/50k) + Parents (₹25k/50k)
100% of actual interest paid (No upper cap)
Regime Comparator SummarySavings: ₹63,180
Statutory Recommendation
Section 202(1) New Regime (Default)
Old Regime Tax
₹1,60,680
Deductions: ₹3,10,000
New Regime (Act 2025)
₹97,500
₹12L Rebate (Sec 156(2))
Total Chapter VIII Deductions:₹3,10,000
Standard Deduction (Old):₹50,000
Net Taxable Income (Old):₹11,40,000
Schedule XV Rules
Schedule XV Specified Investments (Section 123)
Strict proof of payment required for EPF, PPF, ELSS lock-in (3 years), 5-year bank FDs, and principal loan repayment before 31st March of the tax year.
Verified under CBDT Circulars
Section 124(2) Employer NPS
Both Regimes Compatibility for 14% Employer NPS
Employer contributions to National Pension System up to 14% of salary (Basic + DA) are fully allowable under both Section 202(1) New Regime and Old Regime.
Dual-Regime Tax Deduction
Form 10-IEA Election
Mandatory Form 10-IEA for Business Income Opt-Out
Taxpayers with business/profession income must file Form 10-IEA on or before the due date under Section 263(1) to claim Chapter VIII deductions under Old Regime.
Statutory Filing Requirement
Personalized Tax Regime Optimization & Chapter VIII Structuring
Taxorion Advisory Serviices provides individualized regime simulations, salary restructuring for corporate executives, startup deduction certification under Section 140 (80-IAC), and Section 146 employment audit.