Section 80CCC - Tax Saving Deduction for Premium Paid for Pension
Section 80CCC in income tax relates to tax saving due to contributions to pension funds of LIC or other insurer. Basically, if you have invested in schemes or funds that promises a pension (or annuity), than you can deduct your yearly contributions from your total income while calculating income tax
Please note that max possible deduction under this scheme is Rs 1.5 Lakhs for FY 2016 - 2017 (Assessment year AY 2017-18).
For FY 2016-17 (AY 2017-18), This maximum limit of Rs. 150000 (1.5 Lakhs) is the aggregate of the deduction that may be claimed under sections 80C, 80CCC and 80CCD.
More detailed description as per govt policy is described below.
Deduction in respect of contribution to certain pension funds - 80CCC
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Where an assessee being an individual has in the previous year paid or deposited any amount out of his income chargeable to tax to effect or keep in force a contract for any annuity plan of Life Insurance Corporation of India 51[or any other insurer] for receiving pension from the fund referred to in clause (23AAB) of section 10, he shall, in accordance with, and subject to, the provisions of this section, be allowed a deduction in the computation of his total income, of the whole of the amount paid or deposited (excluding interest or bonus accrued or credited to the assessee’s account, if any) as does not exceed the amount of 1.5 Lakh rupees in the previous year.
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Where any amount standing to the credit of the assessee in a fund, referred to in sub-section (1) in respect of which a deduction has been allowed under sub-section (1), together with the interest or bonus accrued or credited to the assessee’s account, if any, is received by the assessee or his nominee—
- (a) on account of the surrender of the annuity plan whether in whole or in part, in any previous year, or
- (b) as pension received from the annuity plan,
an amount equal to the whole of the amount referred to in clause (a) or clause (b) shall be deemed to be the income of the assessee or his nominee, as the case may be, in that previous year in which such withdrawal is made or, as the case may be, pension is received, and shall accordingly be chargeable to tax as income of that previous year.