Section 80DD of income tax act provides tax deductions to resident individuals or HUFs for any expenses incurred on the medical treatment of differently abled dependents. This income tax deduction can be claimed at the time of filing ITR under Chapter VI-A.
What are the Conditions to Claim Section 80DD Deduction?
Below are the conditions to avail 80DD deduction:
- The individual must be a resident Indian.
- The deduction should be claimed for the dependent family member and not for the taxpayer himself.
- Further, if the dependent has claimed a deduction u/s 80U, then the taxpayer cannot claim this deduction u/s 80DD.
- The taxpayer has incurred expenses for medical treatment, nursing, rehabilitation, or training of the differently-abled dependent.
- The taxpayer has paid or deposited any amount under a scheme framed by LIC or any other insurer to take care of the dependant.
- The disability of the dependent is at least 40%.
- A copy of the certificate issued by medical authorities certifying the ‘person with a disability’ has to be submitted along with income tax return.
Hence, if taxpayers fulfill the above conditions, they are eligible to claim deduction under section 80DD of income tax act.
Which Medical Authority is eligible to issue the certificate?
It is essential to have a medical certificate from a licensed medical practitioner to claim the deduction. The below-mentioned are deemed reliable for such a certificate:
- A neurologist with an MD in Neurology
- Pediatric Neurologist in case of disabled children
- A civil surgeon or Cheif Medical Officer in a government hospital
Who are covered under ‘dependents’?
The aforementioned individuals must be entirely or primarily dependent on the taxpayer for their welfare in order to qualify for the deduction.
- Member of HUF
What is the 80DD deduction Limit?
Section 80DD of income tax act allows flat deductions, irrespective of the amount of expenditure incurred during the year but it should not be nil. However, the amount of deduction depends upon the severity of the disability.
There are two categories for a person with a disability under section 80DD:
- Disabled Person: An individual suffering from at least 40% of disability
- Severely Disabled Person: An individual suffering from at least 80% of disability
|Disabled Person||INR 75,000|
|Severly Disabled Person||INR 1,25,000|
Note: If the taxpayer opts for the new tax regime, he cannot claim a deduction under Section 80DD of income tax act.
Which disabilities are covered u/s 80DD?
The following disabilities are covered under this deduction:
- Cerebral palsy
- Low vision
- Leprosy cured
- Hearing impairment
- Locomotor disability
- Mental retardation
- Mental illness
ITR Form Applicable for Section 80DD
The taxpayer can claim the deduction while filing an ITR if all the above-mentioned conditions are met. Individuals or HUFs can claim 80DD in any of the ITR forms, i.e., ITR 1, ITR 2, ITR 3, and ITR 4 depending upon their income sources.
- Medical Certificate
- Form 10-IA
- Self-Declaration Certificate
- Receipts of Insurance Premium
This form can be found on Income Tax Website.
Comparison between 80U & 80DD
|Eligible beneficiary||Taxpayer himself||Dependedents of taxpayer|
|Type of beneficiary||Resident Individual||Resident Individual or HUF|
|Pre-requisite of incurring expenses||Flat deduction irrespective of the expenses incurred||Flat deduction provided that expenses have been incurred for support & maintenance of dependent|
|Amount of deduction||Normal disability > INR 75,000|
Severe disability > INR 1,25,000
|Normal disability > INR 75,000|
Severe disability > INR 1,25,000
The deduction amount is fixed at INR 75,000 for a disabled dependent and at INR 1,25,000 for a severely disabled dependent. This amount is fixed, irrespective of the amount you spend on the treatment of disabled dependents.
No. An NRI can not claim the deduction, this deduction is only available to resident taxpayers.
You require a medical certificate from the medical boards stating the disability as issued by the government to avail the tax deduction.
Yes, you can claim both the tax deductions provided you fulfill the conditions.