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Income Tax Act 2025 · Deductions

Deductions from Total Income (Chapter VIII) — Income-tax Act 2025

The deductions that reduce your taxable income — the ₹1,50,000 investment deduction, NPS, health insurance and donations — and why most are only available under the old regime.

Chapter VIII (sections 122 onward) of the Income-tax Act, 2025 lists the deductions you subtract from your gross total income to arrive at taxable income — the successors to the familiar 80C, 80D, 80CCD and 80G deductions.

  • Section 122 — the general rule: total deductions cannot exceed your gross total income.
  • Section 123 — the big ₹1,50,000 deduction for life insurance, PF, ELSS, tuition fees, home-loan principal and more (Schedule XV) — the 80C successor.
  • Section 124 — pension scheme (NPS) contributions.
  • Section 126 — health insurance premia (the 80D successor).

Important: most of these deductions are available under the old tax regime. If you are taxed under the default new regime, the majority of Chapter VIII deductions do not apply (a few, like the employer NPS contribution, still do). Choose your regime with this in mind.

Sections in this topic

§122
Section 122 of the Income-tax Act, 2025 — Deductions from Gross Total Income: The General Rule (Chapter VIII)
How Chapter VIII deductions work — subtracted from gross total income, and never more than it.
§123
Section 123 of the Income-tax Act, 2025 — ₹1,50,000 Deduction for Investments & Payments (the New Section 80C)
The main tax-saving deduction — up to ₹1,50,000 for life insurance, PF, PPF, ELSS, tuition fees, home-loan principal and...
§124
Section 124 of the Income-tax Act, 2025 — Deduction for Pension Scheme (NPS) Contributions
Deduction for your own and your employer's contribution to a notified pension scheme (NPS).
§125
Section 125 of the Income-tax Act, 2025 — Deduction for Contribution to the Agnipath Scheme (Agniveer Corpus Fund)
Deduction in respect of contribution to Agnipath Scheme
§126
Section 126 of the Income-tax Act, 2025 — Health Insurance Premium Deduction (Old 80D)
Deduction for health insurance premiums for yourself, family and parents, plus certain medical expenditure.
§127
Section 127 of the Income-tax Act, 2025 — Deduction for Maintenance of a Dependant with Disability (old 80DD)
Dependant who is a person with disability
§128
Section 128 of the Income-tax Act, 2025 — Deduction for Medical Treatment of Specified Diseases (Old Section 80DDB)
Deduction in respect of medical treatment, etc
§129
Section 129 of the Income-tax Act, 2025 — Deduction for Interest on Education Loan (Old Section 80E)
Deduction in respect of interest on loan taken for higher education
§130
Section 130 of the Income-tax Act, 2025 — Deduction for Interest on Home Loan (Old Section 80EE)
Deduction in respect of interest on loan taken for residential house property
§131
Section 131 of the Income-tax Act, 2025 — Additional ₹1.5 Lakh Deduction for Home Loan Interest (Affordable Housing)
Deduction in respect of interest on loan taken for certain house property
§132
Section 132 of the Income-tax Act, 2025 — Deduction for Interest on Loan to Buy an Electric Vehicle (old Section 80EEB)
Deduction in respect of purchase of electric vehicle
§134
Section 134 of the Income-tax Act, 2025 — Deduction for Rent Paid (Old 80GG)
Deductions in respect of rents paid
§135
Section 135 of the Income-tax Act, 2025 — Deduction for Donations for Scientific Research or Rural Development (Old Section 80GGA)
Development
§136
Section 136 of the Income-tax Act, 2025 — Deduction for Political Contributions by Companies (Old Section 80GGB)
Deduction in respect of contributions given by companies to political parties
§137
Section 137 of the Income-tax Act, 2025 — Deduction for Contributions by Any Person to Political Parties (Old Section 80GGC)
Section 137
§138
Section 138 of the Income-tax Act, 2025 — Deduction for Enterprises in Infrastructure Development (Continuation of Section 80-IA Benefits)
Enterprises engaged in infrastructure development, etc
§139
Section 139 of the Income-tax Act, 2025 — Deduction for Developers of Special Economic Zones (SEZs)
Engaged in development of Special Economic Zone
§140
Section 140 of the Income-tax Act, 2025 — 100% Tax Deduction for Eligible Start-ups (Old Section 80-IAC)
Section 140
§141
Section 141 of the Income-tax Act, 2025 — Deduction for Profits from Certain Industrial Undertakings
Deduction in respect of profits and gains from certain industrial under-takings
§142
Section 142 of the Income-tax Act, 2025 — Deduction for Profits and Gains from Housing Projects (Affordable & Rental Housing)
Deductions in respect of profits and gains from housing projects
§143
Section 143 of the Income-tax Act, 2025 — Special Provisions (100% Deduction) for Undertakings in North-Eastern States
Special provisions in respect of certain undertakings in North-Eastern States
§145
Section 145 of the Income-tax Act, 2025 — Deduction for the Business of Collecting and Processing Biodegradable Waste
Gradable waste
§146
Section 146 of the Income-tax Act, 2025 — Deduction for Additional Employee Cost (Old Section 80JJAA)
Deduction in respect of additional employee cost
§147
Section 147 of the Income-tax Act, 2025 — Deduction for Units in International Financial Services Centre (IFSC) and Offshore Banking Units
Financial Services Centre
§148
Section 148 of the Income-tax Act, 2025 — Deduction for Inter-Corporate Dividends (Old Section 80M)
Deduction in respect of certain inter-corporate dividends
§149
Section 149 of the Income-tax Act, 2025 — Deduction for Income of Co-operative Societies (old Section 80P)
Deduction in respect of income of co-operative societies
§150
Section 150 of the Income-tax Act, 2025 — Deduction for Royalty Income of Authors (Old Section 80QQB): The Complete Guide
Section 150
§151
Section 151 of the Income-tax Act, 2025 — Deduction for Royalty Income of Authors of Books (other than Text-books)
Than text-books
§152
Section 152 of the Income-tax Act, 2025 — Deduction for Royalty on Patents (Old 80RRB)
Deduction in respect of royalty on patents
§153
Section 153 of the Income-tax Act, 2025 — Deduction for Interest on Savings and Deposits (Old 80TTA/80TTB)
Deduction for interest on deposits
§154
Section 154 of the Income-tax Act, 2025 — Deduction for a Person with Disability (old Section 80U)
Deduction in case of a person with disability

Key rules, limits & exemptions

⚖️
Which deductions survive in the new tax regime?
Most Chapter VIII deductions are old-regime only; a short list still applies in the default new regime.

Frequently asked questions

What is the maximum deduction under Section 123 (old 80C)?
₹1,50,000 in aggregate for the eligible investments and payments listed in Schedule XV — life insurance, PF/PPF, ELSS, tuition fees, home-loan principal and more.
Are Chapter VIII deductions available in the new tax regime?
Mostly no. Under the default new regime, most Chapter VIII deductions are not available; a limited few (such as the employer NPS contribution) still apply. They are chiefly an old-regime benefit.
Disclaimer: Educational overview of the Income-tax Act, 2025 (effective 1 April 2026), not professional advice. Confirm your position with our team before acting.

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