Section 80C → Section 123
Deduction for LIC, PPF, EPF (Under Old Tax Regime)
Quick Answer
Section 80C of the Income Tax Act, 1961 (Deduction for LIC, PPF, EPF (Under Old Tax Regime)) corresponds to Section 123 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 80C
Section 80C of the 1961 Act sets out the rules on deduction for LIC, PPF, EPF (under old tax regime). Allows deduction up to Rs. 1.5 Lakhs for investments in PPF, EPF, LIC, ELSS, etc.
Under the Income-tax Act, 2025 (effective 1st April 2026), Section 80C is retained and renumbered as Section 123 of the Income-tax Act, 2025. Moved to Section 123. The Rs. 1,50,000 limit is retained as an aggregate cap, but it is ONLY available if the taxpayer actively opts out of the Default New Regime.
The transition impact on Section 80C is assessed as Critical. Requires active tax planning to claim.
Sec 80C
Provision Summary
Allows deduction up to Rs. 1.5 Lakhs for investments in PPF, EPF, LIC, ELSS, etc.
Sec 123
Provision Summary
Moved to Section 123. The Rs. 1,50,000 limit is retained as an aggregate cap, but it is ONLY available if the taxpayer actively opts out of the Default New Regime.
Key Changes & Highlights
- Section number changed to 123.
- Must file a specific declaration to opt-out of Section 115BAC to claim this.
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Frequently Asked Questions
Which subject does Section 80C of the 1961 Act cover?
Section 80C of the Income Tax Act, 1961 covers deduction for LIC, PPF, EPF (under old tax regime). Allows deduction up to Rs. 1.5 Lakhs for investments in PPF, EPF, LIC, ELSS, etc.
What is the new section number for Section 80C under the Income-tax Act, 2025?
Section 80C of the Income Tax Act, 1961 maps to Section 123 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Moved to Section 123. The Rs. 1,50,000 limit is retained as an aggregate cap, but it is ONLY available if the taxpayer actively opts out of the Default New Regime.
How does the Income-tax Act, 2025 affect Section 80C in practice?
The transition impact for Section 80C is rated Critical. Requires active tax planning to claim.
What is new about Section 80C under the Income-tax Act, 2025?
Section number changed to 123. Must file a specific declaration to opt-out of Section 115BAC to claim this. These points are specific to Section 80C (Deduction for LIC, PPF, EPF (Under Old Tax Regime)).
Disclaimer: This mapping of Section 80C (Deduction for LIC, PPF, EPF (Under Old Tax Regime)) to Section 123 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 80C is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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