Section 80CCD → Section 124
Deduction in respect of contribution to National Pension System (NPS)
Quick Answer
Section 80CCD of the Income Tax Act, 1961 (Deduction in respect of contribution to National Pension System (NPS)) corresponds to Section 124 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 80CCD
Section 80CCD of the 1961 Act sets out the rules on deduction in respect of contribution to national pension system (NPS). Deduction for employee/self contribution to NPS (under 80CCD(1) and (1B)) and employer's contribution (under 80CCD(2)).
From 1st April 2026, the same subject sits at Section 124 of the Income-tax Act, 2025 — retained and renumbered as Section 124 of the Income-tax Act, 2025. Retained. Employer's contribution to NPS (up to 10% or 14% of salary) remains highly promoted even in simplified tax regimes.
For Section 80CCD, the practical impact is rated High. Primary vehicle for modern corporate retiral planning.
Sec 80CCD
Provision Summary
Deduction for employee/self contribution to NPS (under 80CCD(1) and (1B)) and employer's contribution (under 80CCD(2)).
Sec 124
Provision Summary
Retained. Employer's contribution to NPS (up to 10% or 14% of salary) remains highly promoted even in simplified tax regimes.
Key Changes & Highlights
- The extra Rs. 50,000 deduction is more prominently tracked to encourage retirement savings.
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Frequently Asked Questions
What is Section 80CCD of the Income Tax Act, 1961 about?
Section 80CCD of the Income Tax Act, 1961 covers deduction in respect of contribution to national pension system (NPS). Deduction for employee/self contribution to NPS (under 80CCD(1) and (1B)) and employer's contribution (under 80CCD(2)).
Which section replaces Section 80CCD in the Income-tax Act, 2025?
Section 80CCD of the Income Tax Act, 1961 maps to Section 124 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. Employer's contribution to NPS (up to 10% or 14% of salary) remains highly promoted even in simplified tax regimes.
What is the impact of the change to Section 80CCD under the new tax code?
The transition impact for Section 80CCD is rated High. Primary vehicle for modern corporate retiral planning.
What should I watch out for when Section 80CCD moves to the 2025 code?
The extra Rs. 50,000 deduction is more prominently tracked to encourage retirement savings. These points are specific to Section 80CCD (Deduction in respect of contribution to National Pension System (NPS)).
Disclaimer: This mapping of Section 80CCD (Deduction in respect of contribution to National Pension System (NPS)) to Section 124 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 80CCD is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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