Maximising tax deductions from income is the trick of money planning that everyone ought to be aware of among Indian taxpayers. With FY 2025-26’s tax year soon upon us, learning about Section 80C and how you can claim a deduction on investments such as EPF and PPF can cut your taxables by a considerable amount. This guidebook, compiled working in collaboration with some of the top chartered accountant firms in Mumbai, will simplify it for you to walk through your choices so that you can optimise your savings and remain in compliance.
What Is Section 80C and Why Does It Matter?
Section 80C is the most sought-after section of the Income Tax Act where tax saving and tax planning occur. Section 80C gives a tax deduction of ₹1.5 lakh annually if an individual invests in any of the financial plans, i.e., EPF (Employees’ Provident Fund) and PPF (Public Provident Fund).
- The deduction from tax is available only under the previous tax regime, but not in the new tax regime.
- The majority of the chartered accountant firm professionals suggest investment planning every year to take maximum benefit of the Section 80C window.
- This section lowers your taxpaying income and results in actual cash savings on your tax outgo.
What Are the Best Investment Options Under Section 80C?
There is a good choice of investment options under Section 80C, usually recommended by the best chartered accountant firms in Mumbai. It is your choice of the right combination depending on your risk profile, financial requirements, and investment horizon.
- Both are government-sponsored, low-risk products with good, tax-free returns.
- Other allowed options include ELSS schemes, Sukanya Samriddhi Yojana, tax-saving fixed deposit, NSC, and life insurance policy premiums.
- Two education charges of children and home loan principal repayment come under Section 80C deduction.
Can EPF and PPF deductions under Section 80C be claimed?
This is the typical query of taxpayers. Yes—to take advantage of the investment in EPF and PPF under Section 80C, with the total limit of ₹1.5 lakh for any financial year not being crossed.
- Most chartered accountant firm advisors suggest splitting the investments between EPF and PPF in order to diversify the risk.
- EPF is obligatory for salaried employees, whereas PPF can be for all and can be self-financed.
- Keep in mind that the total of all investments eligible under Section 80C should not be more than ₹1.5 lakh in a year.
Advantages and Benefits of EPF and PPF under Section 80C
EPF and PPF continue to be two of the best tax-savers for salaried individuals, but also for self-employed individuals.
- EPF: Both employer and employee contribute 12% of basic salary, and the highest allowed contribution of ₹1.5 lakh can be claimed as a deduction u/s 80C.
- PPF: Voluntary plan wherein a minimum of ₹500 yearly and a maximum of ₹1.5 lakh may be contributed.
- Both are tax-exempt at the time of interest and maturity, and therefore can be utilised towards long-term planning of finances.
How Do Section 80C Deductions Affect Your Income Tax Calculation?
Taking deduction under Section 80C is a polite way of putting it that the amount of your tax income is saved, and you only have to pay less tax. Assume, for instance, that your gross taxable income is ₹10 lakh and you take the maximum ₹1.5 lakh of deduction under Section 80C. Your taxable income would then come down to ₹8.5 lakh. Not only are you placed in a lower tax bracket, but you also save your overall outgo by a considerable sum.
- 80C deductions have not changed since 2014; the limit continues to be ₹1.5 lakh for FY 2025-26.
- Top Mumbai chartered accountants say that each year, before tax season, check your portfolio to ensure that deductions are optimised.
- These companies suggest investing at the beginning of the year so that regular compounding can be maximised and there is no rush at the last moment.
What are Other Payments and Investments Qualifying Under Section 80C?
Though EPF and PPF are the most prominent ones, there are hardly any other payments and investments one can avail of deductions under this section.
- Life insurance premium paid on yourself, spouse, or children.
- Sukanya Samriddhi Yojana, Senior Citizens’ Savings Scheme, National Savings Certificate, or contribution to approved superannuation funds.
- Payment of the principal amount of your home loan and the education school fee of your child’s full-time study (for up to two children) also qualifies.
How to Avail Maximum Benefit Under Section 80C?
Proper planning and documentation are of maximum significance. This is how you can avail of maximum benefit under Section 80C:
- Keep proofs of investments in an organised manner and keep them handy to be produced in case of verification being done by your employer or when filing your return.
- Seek the guidance of a chartered accountant firm in case of multiple, irregular income sources or intricate investment details.
- Diversify your basket of Section 80C tax-saving options—mimicking a combination of safe (PPF, EPF) and growth-oriented schemes (ELSS)—to strike the proper safety vs. growth balance.
Why Use the Best Chartered Accountant Firms in Mumbai?
Tax savings may be a task that is difficult to handle for many of us with ever-changing rules and double-investment opportunities. Using the best chartered accountant firms in Mumbai has the potential to cut through uncertainty and reduce the risk of mistakes.
Such firms stay updated with new tax legislation and investments available to ensure maximum compliance and results for clients.
A chartered accountant professional firm can help structure your portfolio for maximum deductions, compliance, and avoidance of unnecessary tax outlay.
They also help with document certification, audit preparation, and complete financial planning for long-term wealth creation.
Maximising Section 80C With EPF and PPF: Expert Pointers
Reputed chartered accountant offices in Mumbai recommend referring to the table below, subsequent to consulting with tax consultants, for best-investment planning.
| Investment Avenue | Interest Rate | Lock-in Period | Risk | Suitability |
| EPF | As notified by EPFO | Till retirement | Low | Salaried employees |
| PPF | 7.9% (as of now) | 15 years | Low | Salaried and self-employed |
| ELSS | 12–15% | 3 years | High | Higher risk appetite, long-term view |
Conclusion
Section 80C investment in EPF, PPF, etc., can reduce your tax outgo significantly. For maximum benefit and peace of mind, avail the services of a well-established chartered accountant firm or one of the top-rated chartered accountant firms in Mumbai such as Epsilon Accounts Anusthan Fintech LLP Professional consultancy keeps your investments, paperwork, and tax returns in perfect harmony and optimised for the highest savings.
FAQs
Q. Is Section 80C deduction available in the New Tax Regime?
No, you can avail of Section 80C only in the Old Tax Regime.
Q. Do I have to invest ₹1.5 lakh to get the deduction?
No, you can invest as much as you wish to, but your maximum limit of deduction will be ₹1.5 lakh.
Q. Are EPF and PPF both tax-free when mature?
EPF and PPF are both EEE tax statuses for eligible taxpayers.
