Education, Pension & Disability Deductions — Sections 80E, 80CCD, 80DD & 80DDB

Education, Pension & Disability Deductions — Sections 80E, 80CCD, 80DD & 80DDB

🏫 1. Section 80E: Education Loan Interest

Education Loan Interest Tax Deduction – Section 80E

✅ Scope & Eligibility:

• Deduction on interest paid on loan taken for higher education.
• Applicable to individual taxpayers only.
• Loan may be for self, spouse, children, or a student for whom you are legal guardian.

💰 Deduction Limit:

• No monetary cap; full interest amount deductible.
• Available for up to 8 years or until loan term ends, whichever is earlier.

📝 Documentation:

• Loan sanction letter (course details & loan amount).
• Interest certificate from lender for FY 2024-25.
• Proof of enrollment in a recognized institution.

Example: Raj took a ₹5 lakh loan at 10% p.a. His interest in FY 24-25 is ₹50,000. He claims the full ₹50,000 under 80E.

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💼 2. Section 80CCD: National Pension System (NPS)

NPS Contribution Tax Benefits – Sections 80CCD(1/1B/2)

2.1 Section 80CCD(1): Employee & Self-Employed

• Employees: Deduction up to 10% of (Basic + DA).
• Self-Employed/Others: Deduction up to 20% of gross income.
• Limit: Within overall ₹1.5 lakh cap of Section 80C.

2.2 Section 80CCD(1B): Additional NPS Top-Up

• Extra deduction of ₹50,000 beyond 80C limit.
• Only self-contributions to NPS Tier I qualify.

2.3 Section 80CCD(2): Employer Contribution

• Employer’s NPS contribution up to 14% of salary deductible.
• Not part of ₹1.5 lakh limit.
• New cap increased from 10% to 14% for all employees.

Mini–Case: Priya (salaried) invests ₹1,20,000 in PPF/ELSS, ₹50,000 in NPS (80CCD(1B)), and her employer contributes ₹70,000 (80CCD(2)). She gets a total deduction of ₹2,40,000.

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♿ 3. Section 80DD & 80DDB: Disability & Medical Treatment

Dependent Disability Deduction – Section 80DD

3.1 Section 80DD: Dependent Disability

• Deduction for maintenance & medical care of a dependent with disability.
• Amount: ₹75,000 (≥40% disability) or ₹1,25,000 (≥80% severe).
• Requirement: Certificate from a prescribed medical authority.

3.2 Section 80DDB: Specified Diseases

Medical Treatment Tax Deduction – Section 80DDB

• Cost of treatment for specified ailments (e.g., cancer, kidney failure, neurological diseases).
• Deduction:
• ₹40,000 (below 60 years)
• ₹1,00,000 (senior citizens ≥60)
• Documentation: Specialist’s prescription and medical bills.

Example: Mr. Singh (age 65) spends ₹1,20,000 on cancer treatment. He claims ₹1,00,000 under 80DDB with doctor’s prescription.

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📋 Summary Table of Deductions

Section	Purpose	Eligible	Max Deduction	Key Condition
80E	Education loan interest	Individual	No cap	Loan for higher education ✓
80CCD(1)	NPS contribution (self)	All	80C cap	10% salary / 20% income
80CCD(1B)	Additional NPS top-up	All	₹50,000	For NPS Tier I
80CCD(2)	NPS contribution (employer)	Salaried	14% salary	Employer-only benefit
80DD	Dependent disability	Ind/HUF	₹75k/₹1.25L	Certificate of disability
80DDB	Specified disease treatment	Ind/HUF	₹40k/₹1L	Specialist prescription + bills

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🔗 Downloadable Checklist & Next Steps

• Download: Education, Pension & Disability Deduction Checklist (PDF)
• Next Article: Miscellaneous Savings & Income Deductions (Sections 80TTA, 80TTB, 80RRB & 80U)

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