How do you use the Section 80C tax savings calculator?
- Enter your taxable income before 80C: salary after the ₹ 50,000 standard deduction and any other deductions, plus other income.
- Enter what you paid this year towards home loan principal, EPF, PPF and ELSS. Life insurance, tuition fees, stamp duty and other items are under “Add insurance, tuition, stamp duty and others”.
- Read the tax saved, how much of the ₹ 1.5 lakh limit you have used, and what a top-up would save.
How it’s calculated
The calculator adds your section 123 (old section 80C) items, caps them at ₹ 1.5 lakh, and compares old-regime tax before and after.
Formulas used by the calculator
Total = Principal + Stamp duty + EPF + PPF + ELSS + Insurance + Tuition + NSC + OtherEligible = min(Total, ₹ 1,50,000); Room left = ₹ 1,50,000 − TotalTax = Slab tax (old regime) − Rebate if taxable ≤ ₹ 5 L, + 4% cessSaved = Tax(Taxable income) − Tax(Taxable income − Eligible)Source: Income Tax Department e-filing portal (Income-tax Act; old regime slabs for tax year 2026-27).
What is Section 80C under the new Income-tax Act?
From 1 April 2026, the Income-tax Act, 2025 replaced the 1961 Act. The old sections 80C, 80CCC and 80CCD(1) are now section 123, with the eligible items listed in Schedule XV. The combined limit stays at ₹ 1.5 lakh a year, and the deduction is available only in the old tax regime. The new regime, which is the default, does not allow it.
For home buyers, two items matter. Principal repaid on a home loan from a lender such as a bank, housing finance company or employer counts, and so do stamp duty, registration fee and transfer charges in the year you pay them. If you sell the home within five years of the end of the year you got possession, the deduction already claimed is added back to your income in the year of sale.
How the saving is worked out
min(total of eligible items, ₹ 1,50,000)Old regime slabs − rebate (to ₹ 5 lakh) + 4% cessTax without the deduction − tax with itWorked example: ₹ 12 lakh taxable income
₹ 50,000 of home loan principal, ₹ 40,000 of EPF, ₹ 20,000 of PPF, ₹ 30,000 of ELSS, ₹ 20,000 of life insurance and ₹ 10,000 of tuition fees add up to ₹ 1,70,000. Only ₹ 1.5 lakh counts. Tax falls from ₹ 1,79,400 to ₹ 1,32,600, a saving of ₹ 46,800, because the whole deduction comes off income taxed at 30%. The extra ₹ 20,000 saves nothing.
Worked example: ₹ 8 lakh taxable income, room left
With only EPF of ₹ 40,000 and life insurance of ₹ 20,000, the deduction is ₹ 60,000 and the saving is ₹ 12,480. The remaining ₹ 90,000 of the limit, if filled, would save about ₹ 18,720 more at the 20% slab.
How much does the full ₹ 1.5 lakh save?
| Taxable income before 80C | Tax without | Tax with | Saved |
|---|---|---|---|
| ₹ 6,00,000 | ₹ 33,800 | ₹ 0 | ₹ 33,800 |
| ₹ 9,00,000 | ₹ 96,200 | ₹ 65,000 | ₹ 31,200 |
| ₹ 12,00,000 | ₹ 1,79,400 | ₹ 1,32,600 | ₹ 46,800 |
| ₹ 20,00,000 | ₹ 4,29,000 | ₹ 3,82,200 | ₹ 46,800 |
What should you keep in mind?
- The deduction lowers your tax only if you file under the old regime. Check both regimes with the home loan tax benefit calculator.
- Home loan interest is a separate deduction (section 22, the old section 24(b)) and does not use up the ₹ 1.5 lakh limit.
- Only payments made during the year count, and investments such as PPF and ELSS come with lock-in periods.
Frequently asked questions
Related answers and guides
- Home Loan Tax Benefit Under the Income-tax Act 2025
- Pre-Construction Home Loan Interest: Can You Claim It?
- DC Conversion Karnataka: Section 95 Rules for Plot Buyers
- Capital Gains Tax on Sale of Flat: Bengaluru 2026 Rules
Sources
- Income-tax Act, 2025, section 123 and Schedule XV (₹ 1.5 lakh limit; home loan principal, stamp duty and registration; five-year rule), in force from 1 April 2026.
- Finance Act, 2026: old regime slabs, ₹ 12,500 rebate and ₹ 50,000 standard deduction unchanged for tax year 2026-27 (Income Tax Department). Checked 19 Oct 2026.
Indicative only. Please verify with your Chartered Accountant before acting.
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