Section 80 JJAA of Income Tax Act

Deduction on employment of New Workmen

This deduction is only for Indian company which is factory.  Any person whose GTI inckudes profit and gains derived from manufacture of goods in a factory

Deduction is

 30% of  Additional wages

 Paid to new workmen employed during the year


      Additional wages means

      Wages paid to new workmen in excess of 100 Workmen   50 Workmen employed

        during previous year

  1.  No deduction allowed if there is less than 10% increase in case as compared to previous year
  2. Report from CA in prescribed Form 10DA required.


Note: -

New workmen should not be due to

  • Transfer from existing business
  • Amalgamation with Another Company


Effect of Amendment

Before Amendment  After Amendment

Additional Wages meant wages paid to new workmen

in excess of 100 workers employed

Additional Wages meant wages paid to new workmen

in excess of 50 workers employed

Deduction only to Indian Company which is a factory Deduction available to all types of assessee whose GTI includes profit and gains from manufacturing business


No deduction under this section if

  • Not a factory
  • Not having 50 employees
  • Not more than 10% increase
  • Workmen employed are Casual /temporary/ contractual / employed for less than 300 days
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CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 14 years. He also provides Accounts Tax GST Training in Delhi, Kerala and online.