💰 Tax Savings · Deductions (80C–80U)
Extra ₹50,000 NPS deduction — Section 123 (old 80CCD(1B))
✍️ EaseValue Advisors · Updated 17 Jul 2026 · FY 2025-26
In short
Your own contribution to the NPS gets an extra ₹50,000 deduction — over and above the ₹1.5 lakh 80C limit — Income-tax Act 2025 (old Section 80CCD(1B)).
The deduction
- An additional ₹50,000 for your NPS (Tier-I) or APY contribution, on top of the ₹1.5 lakh under 80C.
- So a taxpayer maxing 80C can save on up to ₹2 lakh total (₹1.5L + ₹0.5L).
Worked example
In the 30% slab, the extra ₹50,000 saves about ₹15,600 in tax (with cess) every year.
Conditions
- Applies to your own contribution (the employer's NPS is separate — see Section 124 / 80CCD(2), which also works in the new regime).
- This ₹50,000 is old regime only.
- Locked till retirement (partial withdrawals allowed under conditions).
Who it helps
Anyone who has used up 80C and wants a further ₹50,000 of deduction while building a retirement corpus.
The law behind it
old Section 80CCD(1B) Section 124 (old 80CCD(2))
General information for FY 2025-26 (AY 2026-27), not advice on your specific case. Limits, rates and conditions
change with each Finance Act and depend on your facts — confirm before acting. © EaseValue Advisors LLP.
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