Tax Saving
Here are the main tax-saving products and deductions available in India for FY 2026-27 (AY 2027-28). Most Chapter VI-A deductions (including 80C, 80D, 80CCD) are available only under the Old Tax Regime. The New Tax Regime is the default, offering lower tax rates and a higher standard deduction (₹75,000 for salaried), but with limited deductions. Many people still opt for the Old Regime if their total deductions exceed ₹4-5 lakh.
Important Note: The overall limit under Section 80C + 80CCC + 80CCD(1) remains ₹1.5 lakh. NPS gives an extra ₹50,000 under 80CCD(1B), taking the effective limit to ₹2 lakh for retirement-focused saving.
Section | Max Deduction | Eligible Products / Expenses | Lock-in / Key Features | Best For | Tax Treatment |
|---|---|---|---|---|---|
80C | ₹1.5 lakh (combined) | – PPF – ELSS Mutual Funds – Life Insurance Premiums (Traditional/ ULIP) – EPF (employee contribution) – Tax-Saving FD (5 years) – NSC – Home Loan Principal Repayment – Sukanya Samriddhi Yojana (SSY) – Tuition Fees (up to 2 children) | Varies (3 yrs for ELSS, 5 yrs for FD/NSC, 15 yrs for PPF) | Long-term goals, equity exposure (ELSS), safety (PPF) | EEE (mostly) |
80CCD(1B) | Additional ₹50,000 | National Pension System (NPS) – Tier I contributions (self) | Till age 60 (partial withdrawal allowed) | Retirement planning | Extra deduction over 80C |
80D | ₹25,000 (self + family) ₹50,000 (senior citizens) | Health Insurance Premiums (including family & parents) + Preventive Health Check-up (₹5,000) | Annual renewal | Family health protection | Deduction on premium |
80CCD(2) | Up to 14% of (Basic + DA) | Employer’s contribution to NPS (available in both Old & New Regime) | Till retirement | Salaried employees | Employer contribution deductible |
24(b) | ₹2 lakh (self-occupied house) | Home Loan Interest (for purchase/construction) | No lock-in (subject to conditions) | Home buyers | Interest deduction |
80G | 50% or 100% of donation | Donations to specified charities / funds | No lock-in | Philanthropy | Varies |
Essential risk cover. Premiums for self, spouse, children, and parents are deductible. Senior citizens get a higher limit.
Employer NPS contribution (80CCD(2)) works in both regimes — ask your HR to route part of CTC into NPS if possible.
ask your HR to route part of CTC into NPS if possible.
These products not only save tax but also help build wealth, provide protection (insurance), and secure retirement (NPS/PPF). NPS and general insurance (health/motor) align well with the products you asked about earlier.
