By: Manish Negi
There are various significant points which must keep in mind while planning tax under section 80C of Income Tax Act, 1961. Following are some of them:
- If assessee surrender their Life Insurance Policy within three years, then assessee has to pay the tax on the amount of deduction claimed earlier under section 80C i.e. premium paid on insurance of life.
- Investment under Post Office Time Deposit Rules, 1981 and Senior Citizen Savings Scheme Rules, 2004 is a eligible deduction under section 80C but if assessee withdrawn any amount from his account under above mentioned scheme before the expiry of five years from the date of deposit, then the amount so withdrawn shall be deemed to be income and chargeable to tax.
- If assessee terminates his participation in any Unit Linked Insurance Plan within five years, then assessee has to pay the tax on the amount of deduction claimed earlier under section 80C i.e. Contribution in the Unit-linked Insurance Plan 1971 or any Unit linked Insurance Plan of LIC Mutual Fund.
- If assessee sell their house which was purchased through home loan within five years from the date of purchase, then assessee has to pay the tax on the amount of deduction claimed earlier under section 80C i.e. repayment of principle amount of loan.
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