Chapter VIII of the Income-tax Act, 2025 — Deductions to Be Made in Computing Total Income

What this chapter does

Sections 122 to 154 collect what the 1961 Act carried in Chapter VI-A. Personal deductions run from section 123 (life insurance premia, provident fund and the rest) through health insurance, disability, medical treatment, education loan interest, housing loan interest and electric vehicle interest. Business and area-based deductions follow, covering infrastructure undertakings, special economic zones, housing projects, North-Eastern States units and international financial services centre units. Section 133 carries donations, and sections 136 and 137 political contributions.

What to watch

• Almost every deduction here is unavailable under the new regime in section 202; check the regime before the deduction.
• The deduction sections are drafted with their own conditions — the Schedule reference in a section is part of the condition, not a footnote.

The sections in this chapter

• Section 122 — Deductions to be made in computing total income
• Section 123 — Deduction for life insurance premia, deferred annuity, contributions to provident fund, etc
• Section 124 — Deduction in respect of employer and assessee contribution to pension scheme of Central Government
• Section 125 — Deduction in respect of contribution to Agnipath Scheme
• Section 126 — Deduction in respect of health insurance premia
• Section 127 — Deduction in respect of maintenance including medical treatment of a dependant who is a person with disability
• Section 128 — Deduction in respect of medical treatment, etc
• Section 129 — Deduction in respect of interest on loan taken for higher education
• Section 130 — Deduction in respect of interest on loan taken for residential house property
• Section 131 — Deduction in respect of interest on loan taken for certain house property
• Section 132 — Deduction in respect of purchase of electric vehicle
• Section 133 — Deduction in respect of donations to certain funds, charitable institutions, etc
• Section 134 — Deductions in respect of rents paid
• Section 135 — Deduction in respect of certain donations for scientific research or rural development
• Section 136 — Deduction in respect of contributions given by companies to political parties
• Section 137 — Deduction in respect of contributions given by any person to political parties
• Section 138 — Deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc
• Section 139 — Deductions in respect of profits and gains by an undertaking or enterprise engaged in development of Special Economic Zone
• Section 140 — Special provision in respect of specified business
• Section 141 — Deduction in respect of profits and gains from certain industrial undertakings
• Section 142 — Deductions in respect of profits and gains from housing projects
• Section 143 — Special provisions in respect of certain undertakings in North-Eastern States
• Section 144 — Special provisions in respect of newly established Units in Special Economic Zones
• Section 145 — Deduction for businesses engaged in collecting and processing of bio-degradable waste
• Section 146 — Deduction in respect of additional employee cost
• Section 147 — Deductions for income of Offshore Banking Units and Units of International Financial Services Centre
• Section 148 — Deduction in respect of certain inter-corporate dividends
• Section 149 — Deduction in respect of income of co-operative societies
• Section 150 — Interpretation for purposes of section 149
• Section 151 — Deduction in respect of royalty income, etc , of authors of certain books other than text-books
• Section 152 — Deduction in respect of royalty on patents
• Section 153 — Deduction for interest on deposits
• Section 154 — Deduction in case of a person with disability