We know that five heads of Income combine to form Gross Total Income

Out of these,Certain Items called Deductions are reduced to arrive at Net total Income.

Tax is imposed on this Net total income as shown below


Particulars Amt
Income from Salaries xx
Income from House Property xx
Profits and Gains of Business and Profession xx
Income from Capital Gains xx
Income from Other Sources xx
Gross Total Income xx
Deductions under Chapter VIA xx
Net Total Income  
Tax on Net total Income xx

hence Deductions lead to decrease in Income and hence decrease in tax

Hence these are beneficial to the assessee

Lets study these in detail

  1. Income Tax
  2. Deductions Under Chapter VIA
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Davneet Singh
Davneet Singh is a graduate from Indian Institute of Technology, Kanpur. He has been teaching from the past 8 years. He provides courses for Maths and Science at Teachoo. You can check his NCERT Solutions from Class 6 to 12.