Section 80ccd(1)

Tax queries 679 views 2 replies

Cost Accountant

Student

92 Points Posted on 10 May 2015

Please guide me through the new rules of Section 80CCD(1).

I simply can't understand whether the quatum of deduction is Rs. 1,00,000/- OR 10% of salary (+DA) OR both?

Also, Section 80CCE is putting a limit of Rs.1.5L/- on aggregate of 80C, 80CCC & 80CCD(1) ?

Wont all the three limits will bump into each other in case of Section 80CCD(1) ?

I mean, if both is the ccorrect answer, this means they are applying 3 limits viz. - (i) Rs.1,00,000/- (ii) 10% of Salary (+DA) and (iii) Rs.1.5 Lakhs/- on Section 80CCD (1). But How??

Its all getting very baffled to understand. Please elaborate with an example.

Kindest Regards.

I. Agarwal

Replies (2)

pavan kumar

CA Final CMA Final

202 Points Posted on 14 May 2015

Deduction u/s 80CCD(1).. is 10% of salary or Rs100000 which ever id lower

Jishnu Surendran

Finance Manager

312 Points Posted on 16 May 2015

80CCE limits the deduction on 80C, 80CC, 80CCD to 150000 on the aggregate.......

lets take an example....

80C - 50000

80CC - 25000

80CCD - 115000

firstly you have to apply the restriction on 80CCD of rs 100000....so you cannot claim 115000 as deduction but only 100000

then you can claim only 50000 for the rest...out of an aggregate allowable deduction on 80C, 80CC, 80CCD of rs 100000.....since the total of others is rs 75000 it is restricted to 50000....

in the above case if 80C is 15000 and 80CC is 25000....then you claim only 40000 ( 25000 + 15000 ) on the two....you cannot claim additionally rs 10000 carved out from 80CCD because it is already in the limit of 100000.