Section 80-IA gives a 100% deduction of profits for any 10 consecutive assessment years to undertakings that develop, operate and maintain eligible infrastructure, power, industrial parks or telecom services — the taxpayer picks the 10 years within a 15–20 year window. But two catches decide everything: the sunset — infrastructure and power undertakings must have begun operations before 1 April 2017 to claim it at all, and MAT at 15% (AMT 18.5% for LLPs) still applies on book profits even when regular tax is nil.
Eligible Businesses Under Section 80-IA
The undertaking must own and operate the facility — a pure works contractor building it for someone else does not qualify (Explanation to s.80-IA(13)). It must be a new undertaking, not formed by splitting or reconstructing an existing business, and old plant & machinery must not exceed 20% of total value.
| Category | Examples | Deduction window |
|---|---|---|
| Infrastructure facility | Roads, highways, bridges, airports, ports, rail systems, water supply, irrigation, solid-waste management | 10 of first 20 yrs |
| Industrial parks | Notified industrial parks | 10 of first 15 yrs |
| Power | Generation, transmission & distribution (thermal, hydro, wind, solar) | 10 of first 15 yrs |
| Telecom services | Basic / cellular / broadband, etc. | 100% yrs 1–5, then 30% yrs 6–10 |
Deduction is on profits "derived from" the eligible undertaking, computed as if it were the only source of income (s.80-IA(5)).
Core conditions (all must hold)
- New undertaking — not formed by splitting up or reconstruction of an existing business
- Ownership & operation of the facility — not merely an EPC / works contractor
- Old plant & machinery used does not exceed 20% of total value
- Accounts audited and Form 10CCB filed with the return
- Return of income filed on or before the s.139(1) due date (else claim forfeited)
The 1 April 2017 Sunset
This is the point most guides bury. Section 80-IA is not open to new undertakings that begin developing or operating an infrastructure facility on or after 1 April 2017 (s.80-IA(4)(i)). The same 1 April 2017 cut-off applies to power undertakings under s.80-IA(4)(iv). Only undertakings that commenced before that date can still run out the tail of their 10-year window in FY 2025-26.
If your undertaking begins operations on or after 1 April 2017, the 80-IA claim is barred outright — no extension has been granted in any Finance Act up to Budget 2025. Explore Section 35AD (100% capital-expenditure deduction for specified businesses, including certain infrastructure) instead, and get the position vetted before you file.
Not sure whether your undertaking is inside or outside the 80-IA window? Get it checked.
Talk to a Tax Expert →The MAT / AMT Trap
Even when 80-IA reduces your regular tax to nil, tax is not zero. Companies pay Minimum Alternate Tax at 15% (plus surcharge & cess) under Section 115JB on book profits — which still include the 80-IA-exempt income. LLPs, firms and others pay Alternate Minimum Tax at 18.5% under Section 115JC on adjusted total income.
Company — 80-IA year (illustration)
What the MAT buys you
The realistic benefit is a 15%-vs-full-rate cash-flow gain during the deduction years plus a MAT credit to use later. Model MAT and advance-tax in every 80-IA year — companies that ignore 115JB get hit with interest under s.234B/234C.
80-IA vs 80-IAB vs 80-IAC
| Provision | Who | Eligible business | Benefit | Status FY 2025-26 |
|---|---|---|---|---|
| 80-IA | Company / any person | Infrastructure, power, industrial parks, telecom | 100% for 10 of 15–20 yrs | Sunset 1 Apr 2017 |
| 80-IAB | SEZ developer (company) | Developing a notified SEZ (SEZ Act 2005) | 100% for 10 of 15 yrs | Closed for new SEZs |
| 80-IAC | DPIIT-recognised start-up | Innovation start-ups, turnover ≤ ₹100 Cr | 100% for 3 of first 10 yrs | Live · incorp. by 31 Mar 2030 |
Budget 2025 extended 80-IAC eligibility to start-ups incorporated up to 31 March 2030 — the only one of the three still open to fresh entrants.
How to claim (for undertakings inside the window)
Section 80-IA — Frequently Asked Questions
Related TaxClue services
Section 80-IA — Eligibility, MAT & Filing Sorted
Whether you are running out an existing 80-IA window, evaluating Section 35AD, or a DPIIT start-up eyeing 80-IAC, TaxClue's CA-led team handles eligibility, MAT/AMT modelling, Form 10CCB and return filing — 100% online, across India.