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Tax
The ₹1.5 lakh ceiling, the ₹50,000 NPS slice, the three-year ELSS lock-in — and the one deduction the new regime keeps.
Tax-saving in India is a small, well-defined box: section 80C holds ₹1.5 lakh, 80CCD(1B) adds ₹50,000 for NPS, and section 80CCD(2) covers an employer's NPS contribution on top. What changed is where those deductions work: the new regime under section 115BAC keeps only 80CCD(2), 80CCH(2), 80JJAA and 80LA(1A), so choosing it switches 80C off entirely. This guide sets out the ceilings, the lock-ins each option carries, and the arithmetic of what a deduction is actually worth.
The combined deduction under sections 80C, 80CCC and 80CCD(1) cannot exceed ₹1,50,000 — so a life-insurance premium, an ELSS investment and your own NPS contribution compete for one bucket, they do not stack. Section 80CCD(1B) sits outside that ceiling as an additional ₹50,000 for NPS, and 80CCD(2) is separate again, covering an employer's NPS contribution at 14% of salary for government employees (and for anyone on the new regime) or 10% otherwise.
A deduction saves your marginal rate on the amount deducted, not the amount itself: ₹1,50,000 of 80C is worth ₹46,800 of tax at a 30% slab (plus cess on the tax saved), ₹31,200 at 20%, ₹15,600 at 10%. If your income is below the regime's rebate threshold, the deduction can be worth nothing at all — the liability is already nil. The tax-saving tool applies your slab to the headroom you enter rather than quoting a headline saving.
ELSS has a minimum investment of ₹500 and a three-year lock-in from the date of allotment of units, after which units can be tendered for repurchase, and they are transferable, pledgeable or assignable only after that period. Compare that with the alternatives in the same ₹1.5 lakh bucket: PPF runs fifteen years with limited withdrawals, a five-year time deposit locks the money for five, and EPF locks it until retirement or the specified advance windows. The deduction is identical; the access is not.
Section 115BAC allows only 80CCD(2), 80CCH(2), 80JJAA and 80LA(1A) — which in plain terms means an employer's NPS contribution, the Agniveer corpus, and two corporate provisions. Everything else in 80C, 80CCC, 80CCD(1) and 80CCD(1B) is unavailable once you are on the new regime. That makes the employer-NPS leg the rare tax benefit that survives either choice, and it is worth asking your employer whether they offer it — a 14% employer contribution is not a small number. Note the limit above it: employer contributions to PF, NPS and superannuation together exceeding ₹7,50,000 in a year are taxed as salary.
Work out the deduction's real value →
No. Section 115BAC restricts the allowed deductions to 80CCD(2) (employer NPS), 80CCH(2) (Agniveer corpus), 80JJAA and 80LA(1A). Section 80C, 80CCC, 80CCD(1) and the additional 80CCD(1B) NPS deduction are all unavailable in the new regime.
Your marginal slab rate applied to the deduction: about ₹46,800 of tax at 30%, ₹31,200 at 20% and ₹15,600 at 10%, before cess on the tax saved. If your income already falls under the regime's rebate, the deduction can be worth nothing — the liability was nil either way.
They are not comparable on one axis and nothing here ranks them. ELSS is equity with a three-year lock-in; PPF is a notified-rate debt instrument with a fifteen-year horizon; NPS is a market-linked retirement corpus with its own partial-withdrawal windows. They compete for the same ₹1.5 lakh, so the choice is about the risk, the lock-in and the horizon you can live with.
Reviewed 25 Sept 2026. Tax rates are set by statute and change with the annual Finance Act, so the Income Tax Department's own pages are the authority — every claim here links to one, with the snapshot date noted where the department's site refused an automated read.