Individuals and HUF can make investment under 80C in name of family member

Invesment can be made in name of self and family member

Investment under Section 80C

Every income tax payer looks for avenues to reduce income tax liability. Investment has to be made before march to be eligible for income tax deduction. Maximum income tax that can be saved is Rs 30,900/-  by investing Rs 1,00,000/- under Section 80C . There is confusion over whether these investment can be made in name of self , spouse , children or family member. In these article we are trying to clear all confusion over the investment can be made in name of which family member.

View more: Investment Declaration and Income Tax saving for salaried Employee

Maximum Deduction allowed under section 80C is Rs 1 lac for both Individuals and HUF’s.

1) Life Insurance Premium :

Most common investment under section 80C is life insurance premium.

IndividualsIndividuals can take benefit for premium paid for self , Spouse and children.

For purpose of investment under section 80C premium paid for dependent or independent , major or minor children are eligible for deduction.

HUF’s : HUF can take benefit for premium paid for any family member in HUF.

2) Statutory provident fund and recognised Provident fund

Individuals: Contribution by individual for self is only allowed as deduction under section 80C.

HUF’s : HUF cannot make contribution.

3) Public Provident fund

Individuals: Individuals can take benefit for contribution paid for self , Spouse and children (major or minor,dependent or not)

HUF’s : HUF’s  can not make contribution to PPF.

4) Equity linked Tax Saving Mutual Funds 

Individuals: Individuals can take benefit for premium paid for self .

HUF’s : Payment in name of HUF only eligible.

Lock in period for Equity Linked Tax saving Mutual Funds is 3 years

5) Tuition Fees 

Individuals: Individuals can only take benefit for tuition fees paid for any two children.

HUF’s : HUF  payment for tuition fees not eligible for deduction under section 80C.

 

6) Tax Saving Fixed deposit with Banks.

Individuals: Individuals can take benefit under section 80C for Fixed deposit in joint name. Please note that First holder is eligible for taking deduction. Holding period for Tax saving Fixed deposit is 5 years.

HUF : HUF’s  can also make Fixed deposit in own name to be eligible for deduction under section 80C.

7) Housing Loan principal repayment

Individuals and HUF : Individuals and HUF can take benefit for Principal repayment of housing loan. Visit here for more details on housing loan benefit .

6) National Saving Certificate.

Individuals: Individuals can take benefit under section 80C for NSC.

HUF’s : HUF’s  can not make contribution to PPF.

Download Income tax calculator to calculate your income tax liablity

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