The newly introduced sec 80 CCD in the Budget says that income tax exemption of ₹50,000 will be given to individuals over and above the limit of ₹1,50,000 in sec 80C, for investments in the NPS. If someone exhausts the 80C limit of ₹1.5 lakh in PPF, EPF, insurance and ELSS and invests only ₹50,000 in NPS, does he qualify for the 80CCD benefit? Or does one have to invest ₹150000 and ₹50000 in NPS to claim benefit of sec 80CCD?
- A. Kumar
No, that's not true. Even if you exhaust your section 80C limit on other investments and invest only ₹50,000 in NPS, you will be able to avail exemptions for this sum under section 80CCD.