Is Section 80C available in the new tax regime?

No. Section 80C deductions are available only under the old tax regime. The new regime removes most exemptions but offers lower tax slabs and a higher ₹75,000 standard deduction.

What is the maximum 80C deduction?

₹1,50,000 per financial year (per individual), aggregated across all qualifying instruments. The limit hasn't changed since FY 2014-15.

Does EPF (employee provident fund) count under 80C?

Yes. The 12% employee contribution to EPF is automatically counted under your ₹1.5L 80C limit. For most salaried people, EPF alone uses ₹40-90k of the limit.

Can I claim 80C for my parents' LIC premium?

No. 80C only allows premium payments for self, spouse, and children. Parents are not included. For parents, use Section 80D (health insurance) and 80DDB (specified illnesses).

Which 80C instrument gives the highest returns?

Historically ELSS — equity mutual fund with 3-year lock-in — has delivered 12-15% CAGR over 10+ years. PPF gives a steady 7.1% (sovereign-backed, tax-free). NPS through 80CCD(1B) is separate from 80C and adds another ₹50k deduction.

Section 80C Explained — All ₹1.5 Lakh Deductions for FY 2026-27

Section 80C is the single most-used tax deduction in India. It lets you reduce up to ₹1,50,000 from your taxable income every year — saving up to ₹46,800 in tax if you're in the 30% slab plus cess. Here's every instrument that qualifies, ranked by what most people should actually use.

Quick answer (TL;DR)

The ₹1.5 lakh limit is shared across all 80C instruments combined. EPF deductions from your salary already use part of it. For most salaried Indians, the simplest mix is: EPF (auto) + ELSS or PPF top-up. Section 80C only works in the old tax regime — in the new regime, you don't get this deduction but get lower slab rates instead.

The full list of 80C instruments

1. Public Provident Fund (PPF)

15-year sovereign-backed scheme. Current rate: 7.1% p.a. (Q1 FY 2026-27), revised quarterly. Interest is tax-free. Lock-in: 15 years (with partial withdrawal from year 7). Best for: conservative investors and the debt portion of any portfolio. Open via bank or post office.

2. ELSS — Equity Linked Saving Scheme

Tax-saving equity mutual funds with the shortest 80C lock-in: just 3 years. Historical 10-year CAGR for category leaders: 12-15%. Gains over ₹1.25L per year taxed at 12.5% LTCG. Best for: investors with 10+ year horizon comfortable with equity volatility.

3. Employee Provident Fund (EPF)

12% of Basic deducted from your salary, plus 12% employer match. Current rate: 8.25% (FY 2025-26), declared annually. Tax-free interest up to ₹2.5L employee contribution per year. Auto-counts under 80C — most salaried people use ₹40-90k just from EPF.

4. National Savings Certificate (NSC)

5-year sovereign-backed bond. Rate: 7.7%, compounded annually. Interest reinvested counts under 80C in years 1-4. Best for: very short-horizon, risk-averse investors.

5. Sukanya Samriddhi Yojana (SSY)

Girl child savings scheme. Rate: 8.2% (Q1 FY 2026-27). Open in name of a daughter under 10. Mature when she turns 21. EEE tax status — completely tax-free. Best for: parents of daughters planning long-term goals like marriage or education.

6. Tax-Saving Fixed Deposits

5-year bank FDs marked as "tax-saving". Rate: typically 6.5-7%. Interest is taxable. Lock-in: 5 years. Honest assessment: usually inferior to PPF/SSY (returns) and ELSS (long-term wealth). Use only if you want simplicity and don't have access to PPF/SSY.

7. Senior Citizen Savings Scheme (SCSS)

5-year scheme for 60+. Rate: 8.2%. Quarterly payouts. Maximum investment: ₹30L. Counts under 80C. Best for: retirees needing regular income.

8. Life Insurance Premium

Term plan, endowment, ULIP, LIC premiums all qualify. Important: premium must be ≤10% of sum assured for the policy to qualify. Avoid: using endowment/ULIPs just for 80C — pure term plan is almost always better.

9. Home Loan Principal Repayment

The principal portion of your home loan EMI qualifies under 80C. Interest portion is separate — claimed under Section 24(b) up to ₹2L on self-occupied property. Plus stamp duty and registration in the year of purchase.

10. Tuition Fees

School / college tuition fees for up to 2 children (any number per child). Excludes development fees, donations, transport, and uniforms. Coaching fees don't qualify.

The right 80C strategy by life stage

Salaried young earner (₹6-12L income)

Your EPF alone uses ₹40-70k. Top up with ELSS via SIP (₹5-10k/month) for long-term wealth. Pure term plan ₹1-1.5Cr cover (~₹6-12k premium) for protection. If you have a daughter, open SSY first — best risk-adjusted return in the list.

Salaried mid-career (₹12-25L income)

EPF uses ₹60-100k. Top up with ELSS or PPF for the remainder. Don't overinvest in 80C — once you cross ₹1.5L, marginal benefit is zero. Look at NPS 80CCD(1B) for an extra ₹50k deduction.

Self-employed

No EPF. Maximise PPF (₹1.5L) + add NPS Tier-1 for the extra ₹50k. ELSS works if you have room above ₹1.5L total via NPS combo. Avoid endowment policies entirely — they're poor investments dressed up as tax savings.

Parents of daughter under 10

SSY before everything else. 8.2% tax-free over 21 years is unmatched in this list. Then EPF (auto) + ELSS top-up.

Common 80C mistakes

Double-counting EPF. Your EPF is already reducing taxable income. Don't invest ₹1.5L on top — you'll exceed the limit and get no benefit.
Buying LIC endowment for tax savings. A pure term plan + ELSS gives 3-4× the wealth over 20 years.
Last-week-of-March panic. SIP ELSS through the year — better averaging, no last-minute scramble.
Investing in 80C under the new regime. Choose your regime first via our income tax calculator. If new regime wins, 80C investments only matter for wealth, not tax savings.

Calculate your exact 80C tax savings

Use our income tax calculator to enter your 80C investments and instantly see your tax under both regimes. Or model long-term wealth from ELSS via the ELSS calculator and from PPF via the PPF calculator.