What is Section 80TTA?
Section 80TTA is one of the main tax deductions sections of the Income Tax Act. It provides tax deductions on the interest on savings accounts with banks, cooperative societies and post offices.
Which Type of Interest Incomes are Allowed as Deduction Under Section 80TTA
Section 80TTA of the Income Tax Act allows deduction on interest income earned from only a savings bank account. This savings bank account can be opened with either banks cooperative societies post offices or all.
Please note that individuals can claim the deduction under Section 80TTA only if they opt for the Old Tax Regime.
Interest Income Not Allowed as Deduction Under Section 80TTA
The deduction under Section 80TTA cannot be claimed on deductions on any interest income other than savings account interest. Therefore, no one can claim a deduction on interest income from fixed deposits, recurring deposits, etc.
Further, deduction under Section 80TTA cannot be claimed if the individual opts for the New Tax Regime.
In addition to this, the following persons can also not claim the deduction under Section 80TTA:
- Companies
- Partnership Firms
- Any other juridical persons
Who can claim a deduction under Section 80TTA?
Deduction under Section 80TTA on savings account interest can be claimed only by individuals under 60 years. If the individual is above 60 years, he can claim a deduction on any interest amount under Section 80TTB.
Maximum Deduction Allowed Under Section 80TTA
The amount of deduction that can be claimed under Section 80TTA is the actual amount of interest or Rs. 10,000, whichever is lower. Please note if the person has multiple savings accounts in different banks, then the maximum deduction that can be claimed for all savings accounts put together is Rs.10,000/-.
How to claim deduction under Section 80TTA
Deduction under Section 80TTA can be claimed by filing the Income Tax Return within the due date of 31st July.
