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Published on: Jul 30, 2026

Section 80P - Income Tax

Section 80P is a section in the Income Tax Act which offers a tax deduction for co-operative societies which are engaged in the specified agricultural activities. Section 80P deduction is available only to primary agricultural credit society or primary co-operative agricultural and rural development bank. The deduction is available when the income earned by the co-operative society from the specified activities is included in the

gross total income of the assessee. This article discusses the quantum of deduction available to a specified co-operative society which is engaged in providing the activities mentioned under Section 80P of Income Tax Act.

100% Deduction

100% deduction is available under Section 80P towards the Profit And Gains attributable to following activities:

  1. Co-operative society carrying on the business of banking or providing credit facilities to the members of the society.
  2. Co-operative society engaged in cottage industry.
  3. Co-operative society engaged in providing marketing of agricultural produce grown by its members.
  4. Co-operative society engaged in the purchase of articles intended for agricultural like seeds, livestock etc. which would be supplied to the members of the co-operative society.
  5. Co-operative society engaged in the processing of the agricultural produce of its member, where, the process is undertaken without the aid of power.
  6. Co-operative society is providing collective disposal of the labour of its members.
  7. Co-operative society is providing fishing or allied activities with the intention of supplying it to the members. Example of allied activities are catching, curing, processing, storing, marketing of fish and even purchase of material and equipment connected with it.
  8. Co-operative society, being a primary society, who is engaged in supplying products like milk, oilseeds, fruits and / or vegetables. Such products are grown by the members of the co-operative society and the same is supplied to below-mentioned categories of person –
        • Federal Co-operative Society engaged in the business of above-mentioned products;
        • Government or local authority;
        • Government Company, a corporation engaged in supplying the above-mentioned products.

Other Deduction 

  1. Deduction towards income from any other activity – In case of any other activity, a deduction upto INR 1,00,000 is available in case of consumer co-operative society and deduction upto INR 50,000 is available in any other case.
  2. Deduction towards interest income – Deduction is available in respect of income by way of interest or dividend when such interest or dividend is earned by the co-operative society by investment in any other co-operative society. In such a case, whole interest income is allowed as deduction.
  3. Deduction towards specific income – Deduction towards income earned by letting of godowns or warehouses for storage, processing or facilitating the marketing of commodities. Income earned for all such activities is allowed as deduction.
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Frequently Asked Questions

Common questions about Section 80P Tax Deduction for Cooperative Societies India.

Section 80P is a provision in the Income Tax Act that offers tax deductions to cooperative societies engaged in specified agricultural activities. It allows these societies to claim deductions on their income from eligible activities, reducing their taxable income.
Primary agricultural credit societies and primary cooperative agricultural and rural development banks are eligible for deductions under Section 80P, provided their income is derived from the specified activities mentioned in the section.
Cooperative societies engaged in banking or providing credit facilities, cottage industries, marketing agricultural produce, purchasing agricultural inputs, processing agricultural produce without power, collective disposal of labor, fishing and allied activities, and supplying certain agricultural products like milk, oilseeds, fruits, and vegetables to specified entities are eligible for a 100% deduction on the income from these activities.
Yes, for income from any other activity not specifically mentioned, consumer cooperative societies can claim a deduction of up to INR 1,00,000, while other cooperative societies can claim a deduction of up to INR 50,000.
Yes, cooperative societies can claim deductions on income earned by way of interest or dividends when such income is derived from investments in other cooperative societies. The entire interest income is allowed as a deduction in such cases.
Income earned by cooperative societies from letting out godowns or warehouses for storage, processing, or facilitating the marketing of commodities is eligible for deduction under Section 80P.
Yes, the deduction under Section 80P is available only on the income earned by the cooperative society from the specified activities, which is included in the gross total income of the assessee.
No, Section 80P specifically applies to cooperative societies engaged in specified agricultural activities. Non-agricultural cooperative societies cannot claim deductions under this section.
No, the article does not mention any time limit or expiry date for claiming deductions under Section 80P. As long as the cooperative society is engaged in the eligible activities and meets the conditions, it can claim the deductions.
No, the article clearly states that deductions under Section 80P are available only for the specified activities mentioned in the section. Income from activities not listed in the section does not qualify for deductions under Section 80P.