Sec 80A of Income Tax Act, 1961: Deductions to be made in computing total income
Updated: Aug 7
A deduction is an expense that can be subtracted from a taxpayer's gross income in order to reduce the amount of income that is subject to taxation. The aggregate of income computed under each head, after giving effect to the provisions for clubbing of income and set off of losses, is known as "Gross Total Income". In computing the total income of an assessee, certain deductions are permissible under sections 80C to 80U from Gross Total Income.
The aggregate amount of deductions under sections 80C to 80U. i.e., under Chapter VI-A shall not, in any case, exceed the "Gross Total Income". Therefore, the total income after deductions will either be Positive or Nil. It cannot be negative due to deductions. If the "Gross total income" is Negative or Nil, No Deduction can be permitted under this Chapter.
Means Gross Total Income ≥ Deduction.
If a deduction is allowed under the above sections to the AOP or BOI then deductions for the same payment/income will not be allowed to the members of the AOP/BOI. [Section 80A(3)].
Notwithstanding anything to the contrary contained in section 10AA or in any provisions of this Chapter under the heading "C.—Deductions in respect of certain incomes" (i.e. deductions under sections 80IA to 80RRB), where, in the case of an assessee, any amount of profits and gains of an undertaking or unit or enterprise or eligible business is claimed and allowed as a deduction under any of those provisions for any assessment year, deduction in respect of, and to the extent of, such profits and gains shall not be allowed under any other provisions of this Act for such assessment year and shall in no case exceed the profits and gains of such undertaking or unit or enterprise or eligible business, as the case may be.
Section 80A(5) :Where the assessee fails to make a claim in his return of income for any deduction under section 10AA or under any provision of this Chapter under the heading "C—Deductions in respect of certain incomes" (i.e. sections 80-IA to 80RRB). no deduction shall be allowed to him thereunder.
Section 80A(7): Where a deduction under any provision of this Chapter under the heading "C.—Deductions in respect of certain incomes" is claimed and allowed in respect of profits of any of the specified business referred to in clause (c) of sub-section (8) of section 35AD for any assessment year, no deduction shall be allowed under the provisions of section 35AD in relation to such specified business for the same or any other assessment year.