Maximum Limit Incentive on Savings on Tax under Section 80CCE

This comprehensive section comprises of section 80C, 80CCC & 80CCD
1. Life Insurance premium ( limited to 20% of the Sum Assured)
2. Subscriptions to the GPF / CPF – Rate of return 8.5%
3. Subscription to ELSS – This will cease to be a tax saving option after the Direct Taxes Code comes into effect in April,2012.
4. Contribution to Public Provident Fund – Maximum `70,000/=
5. Investments in NSC VIII & Accrued interest on NSC deemed to be reinvested – Interest is taxable
6. Fixed Deposits for more than 5 years in SBI/ Scheduled Banks/ Post Office 5 year Time Deposit Scheme – Interest is taxable
7. Tuition fees paid limited two children. Both parents can’t claim deduction for the same expense.
8. Repayment of Housing Loan
9. Contribution both by the individual & Government made to new pension scheme ( Section 80CCD)
10. Senior Citizens Saving Scheme – 9% return but taxable.

Apart from the above savings , a further amount of `20,000/= invested in Infrastructure Bond approved by Government is exempted from Income Tax (Section 80CCF). However, there is a lock-in of 5-7 yrs. & interest income is taxable.