Deduction from Gross Total Income

Chapter VI A of Income Tax Act

Contents

• Introductory Provisions• Some Basic Points• Difference between Exemption and Deduction• Income which are to be reduced from Gross

Total Income• Classification of deductions• Deduction on basis of payment and Physical

Disability

Introductory Provisions• Sec 80A

- maximum deduction - if allowed to AOP/BOI than not for its members

• Sec 80AB - Deduction to be made with reference to the total income included in the GTI.

• Sec 80AC- Benefits of certain deduction not to be allowed in cases where return of income is not filed within the specified time limit. (u/s 139(1))

• Sec 80B- Gross Total Income means total income computed under provisions of the Act without making deduction under Chapter VIA.

• What is Gross Total income? Aggregate of income computed under 5 heads income after giving effect to provisions for clubbing of incomes and set off of Losses – Gross Total Income 5 Heads of Income

- Income from Salaries - Income from House Property - Profit and Gain from Business & Profession

- Income from Capital Gain - Income from Other Sources

• Total income = Gross Total Income – Deduction Under Chapter VIA• If deduction under PART C of Chapter VIA is not claimed while filing the

return, no deduction shall be allowed.

Some basic points

Difference Between Exemption and Deduction

• Exemptions:Income specifically provided by act they do not form part of total income (partly or fully).(sec 10 to 13A)

• Deductions:Certain payments or investments or any provision of IT Act to reduce the total income.

Income which are reduced from Gross Total Income

• For Calculating overall quantum of deduction under chapter VIA the following income are to be reduced from gross total income

• STGC subject to tax u/s 111A• LTCG• Sec 115, Sec 115AB, Sec 115AC, Sec 115AD,

Sec 115ACA• Income of Non-Residents under Chapter XIIA

Classification of Deductions under various heads

Deduction are classified as under:• Based on payment and Physical disability – 80C,80CC,

80CCD, 80CCF, 80D, 80DD, 80DDB, 80E, 80GG, 80U.• Based on Income – 80QQB, 80RRB• Based on Donations & contributions – 80G, 80GGA,

80GGC.• Based on Industrial Undertaking– 80IA, 80IAB, 80IB,

80ID, 80IE.• For Business Assesses & Co-op Societies – 80JJA, 80IA

Deduction on basis of payment and Physical disability

Deduction on basis of payment and Physical disability

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions

Deductions