Section 80DDB: Deduction for Treatment of Specified Diseases

In today’s world, dealing with hefty medical bills, especially for severe illnesses, can be a major financial strain. The continuous expenses over a person’s lifetime create a significant financial burden. Hence section 80DDB of the Income Tax Act allows you to deduct the money you spend on treating severe diseases, providing some relief from the financial load.

Section 80DDB of the Income Tax Act

Section 80DDB provides a deduction for medical treatment of specified diseases. This deduction can only be claimed if an individual or HUF has incurred expenses towards the maintenance and care of self or dependent family members.

Diseases covered under 80DDB

The following diseases are covered under the 80DDB deduction:

• Neurological Diseases mentioned below with a disability of at least 40% and above
  a) Dementia
  b) Dystonia Musculorum Deformans
  c) Motor Neuron Disease
  d) Ataxia
  e) Chorea
  f) Hemiballismus 
  g) Aphasia
  h) Parkinsons Disease
• Malignant cancer
• AIDS
• Dementia
• Chronic Kidney failure
• Haemophilia
• Thalassemia

Eligibility to claim 80DDB deduction

Any of the following taxpayer or dependents who suffers from the disease mentioned under section 80DDB is eligible to claim the deduction of medical expenditure incurred.

In the case of an individual:

• Any resident individuals who themselves suffer from the disease
• Any resident individual who pays for the support & maintenance of the dependent who undergoes the treatment

Note: Dependent includes children, spouse, parents or siblings.

In the case of HUF:

• Karta of the HUF
• Members of the HUF

Deduction limit for section 80DDB

The deduction amount will depend on the age of the person for whom such expenses are incurred.

Important Points:

• The deduction is allowed only up to the amount of expenditure incurred.
• Furthermore, the age of the individual receiving the medical care determines the amount of deduction rather than the age of the assessee or the person claiming the deduction.
• From 1st April 2016, no deduction shall be allowed unless the prescription is obtained for the treatment from a specialist. However, the specialist does not necessarily need to be working at a government hospital.
• While claiming a deduction u/s 80DDB the amount has to be adjusted with the reimbursement received by the insurance company or employer.
• Section 80DDB deduction is not allowed if the taxpayer opts for the new tax regime.
• Deduction u/s 80DDB will not be available to adjust against short-term capital gains u/s 111A, long-term capital gains, and incomes taxed at special rates.

How is the Deduction Calculated Under Section 80DDB?

To understand the calculation better, let us take an example:

Scenario 1:

Abhijeet is 35 years old and incurs an expense of INR 70,000 on the medical treatment of a specific disease. He also receives INR 25,000 as reimbursement from the insurance company against the expenses he has incurred.

As Abhijeet has already been reimbursed for INR 25,000, he will be able to claim a deduction of INR 15,000 (INR 40,000 minus the amount received by the insurance company, i.e., INR 25,000) under Section 80DDB as his age is less than 60 years.

Scenario 2:

Ashutosh is 40 years old and incurs an expense of INR 70,000 on the medical treatment of a specific disease. His insurance company reimbursed INR 50,000 against the expenses he made.

In this scenario, Ashutosh will not be able to claim a deduction under Section 80DDB, as the reimbursement by the insurance company is already more than the permissible limit u/s 80DDB. (It is, however, important to note that if Ashustosh were to incur this expense for a senior citizen then, he will be permissible deduction u/s 80DDB for a Senior citizen would be up to Rs. 1,00,000)

Income Tax Calculator

Calculate income tax liability for FY 2020-21. Compare tax liability as per New vs Old Tax Regime.

Explore

Income Tax Calculator

Calculate income tax liability for FY 2020-21. Compare tax liability as per New vs Old Tax Regime.

Explore

Required documents

For claiming the deduction under this section, the invoices are required for the expenditure. Further, it is mandatory to provide valid proof via the certificate of the disease. A medical practitioner can issue the certificate as shown in the table below.

Earlier, a certificate was required to be obtained and submitted in Form No. 10-I to claim this deduction which has been duly omitted now. You can therefore acquire the same but it not mandatory to provide the form along with your income tax return in order to claim the deduction.

Tip

Earlier, a certificate was required to be obtained and submitted in Form No. 10-I to claim this deduction which has been duly omitted now. You can therefore acquire the same but it not mandatory to provide the form along with your income tax return in order to claim the deduction.

Content of Certificate

The acquired certificate must have the following details:

1. Name and Age of Patient
2. Name of the Disease
3. Details of the specialist issuing the prescription, such as Name, Address, Registration Number, Qualification
4. The name and address of the hospital if the treatment was taken in a government hospital

Find the best plan

Find the best plan

Explore

GET EXPERT HELP

Find the best plan

Find the best plan

Explore

ITR Form Applicable for Section 80DDB

The taxpayer can claim deductions u/s 80DDB while filing ITR if all the conditions are met. Individuals or HUFs can claim 80DDB in any of the ITR forms, i.e., ITR 1, ITR 2, ITR 3, and ITR 4 depending upon their income sources.

FAQs