A tax deduction of up to ₹1.5 lakh per year for investments like EPF, PPF, ELSS, and life insurance, under the Old Tax Regime.
Section 80C of the Income Tax Act allows a deduction of up to ₹1.5 lakh per year for specific investments and expenses — EPF contributions, PPF, ELSS mutual funds, life insurance premiums, and the principal portion of a home loan repayment all qualify.
It's only available under the Old Tax Regime — one of the main reasons employees with significant 80C investments tend to stick with the Old Regime rather than switching to the New one. It's often used alongside Section 80D (medical insurance) and Section 80CCD(1B) (NPS) to further reduce taxable income. Under the Income-tax Act, 2025 (effective FY2026-27), Section 80C is renumbered Section 123 (with Section 80CCD(1B) becoming Section 124) — the ₹1.5 lakh combined limit is unchanged.
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