Correct Answer - Option 3 : Section 80EEB
The correct answer is Section 80EEB
Tax deduction: A tax deduction is a reduction in tax liability that tends to reduce a person's or an organization's tax burden. Deductions are the expenses incurred by a taxpayer during the year on which government does not charge tax and thus can subtracted from the assessee's gross income to determine the amount of tax owing.
Tax Deduction under 80EEB:
| Eligibility |
The deduction of tax under this section is applicable only to individuals. Hindu Undivided Family (HUF), Association of Persons (AOP), Partnership firm, a company, or any other kind of taxpayer is not eligible for tax deduction under this section.
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| Criteria |
Deduction in the interest payment of loan taken for purchasing an electric vehicle. |
| Amount of Deduction |
- Under section 80EEB, an individual can claim a deduction of interest payments on loan taken for the purchase of electric vehicle upto Rs. 1,50,000
- Individuals can claim a deduction of up to Rs 1,50,000 for business use under section 80EEB. Interest payments in excess of Rs 1,50,000 are deductible as a business expenditure.
|
If interest payment for individuals purchasing an Electric vehicle for business use, is in excess of Rs. 1,50,000, then tax deduction is applicable as a business expenditure. For this the vehicle must be registered under the name of the business or the owner of the business.
