WorkIndex/Section 123 Deduction Under New Income Tax Act
Info guide

Section 123 Deduction Under New Income Tax Act
Old 80C-style investments under new numbering

Section 123 is a new Act deduction reference for the Tax Year system. For AY 2026-27 filings, taxpayers still use the 1961 Act and old ITR utility references.

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Last fact-checked: 2026-05-26
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Fact-check notes

Last fact-checked: 2026-05-26

Transition rule: AY 2026-27 covers FY 2025-26 and continues under the Income-tax Act, 1961. The Income-tax Act 2025 Tax Year terminology applies for income earned from 1 April 2026 onward.

This page is written from official portal guidance and the supplied Batch 11 brief. Any future-dated form, rule or portal workflow should be verified in the active utility before filing or advising a client.

Info guide

What this covers

Section 123 is a new Act deduction reference for the Tax Year system. For AY 2026-27 filings, taxpayers still use the 1961 Act and old ITR utility references.

  • Covers PPF, EPF, life insurance, ELSS, NSC, five-year FD, tuition fees and home loan principal where conditions are met.
  • The combined cap remains a critical planning number and should be checked in the active form.
  • Section 202 new-regime pages exclude most Chapter VIII deductions except specifically preserved items.
Use cases

Who this is for

  • Salaried taxpayer building tax-saving plan.
  • Business taxpayer comparing old vs new regime.
  • Parent claiming tuition fee deduction.
  • Homeowner claiming principal repayment.
Records

Documents and data to verify

  • Investment proofs.
  • Premium receipts.
  • School fee receipts.
  • Home loan principal certificate.
Care points

Common mistakes to avoid

  • Claiming Section 123 in the new regime without checking eligibility.
  • Counting tuition for more than eligible children.
  • Using ULIP/life policy without checking premium-to-sum-assured limits.
  • Missing lock-in rules.
Action

How to proceed

  • Confirm the applicable year, taxpayer type, state, registration status and portal form before acting.
  • Reconcile the official portal data with books, bank statements, certificates, invoices and notices.
  • Prepare a written computation, filing note, document checklist or response with assumptions clearly stated.
  • Download acknowledgements, challans, workings and evidence after filing or submission.
Questions people ask

FAQs

Can WorkIndex help with this?

Yes. Post the facts and documents; relevant experts can quote for filing, advisory, reconciliation, registration, appeal support or ongoing compliance.

Is the page a substitute for professional advice?

No. Use it to prepare. A professional should check the current portal utility, official source and records before filing or taking a tax position.

What should I mention while posting?

Mention the year, state, form, deadline, amount involved, documents available, portal status and whether you need filing, correction, opinion or representation.

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