Under Section 80DDB, a deduction is applicable if incurred expenses are on the treatment of specified diseases. Following are the specified diseases:
- Neurological Diseases with a disability of at least 40%
- Malignant cancer
- Chronic Kidney failure
Who can Claim Deduction Under Section 80DDB?
The Section 80DDB deductions can be availed by:
- Any resident individual/ HUF
- An individual for himself or for people dependant on him, like spouse, children, parents, siblings
- HUF for any of its members
- The Karta of the members of the HUF
What is the Deduction Limit Under Section 80DDB?
The deduction is allowed only up to the amount of expenditure incurred. For FY 2018-19 (AY 2019-20), the following deduction limits are applicable:
|Individual or a member of HUF, aged below 60||INR 40,000|
|Individual or a member of HUF, aged 60 years or above||INR 1,00,000|
From 1st April 2016, no deduction shall be allowed unless the prescription is obtained for the treatment from a specialist. It is not necessary that the specialist has to be working at a government hospital.
It is important to note that the while claiming deduction under section 80DDB the amount has to adjusted with the reimbursement received by the insurance company or employer.
How is the Deduction Calculated Under Section 80DDB?
To understand the calcualtion in a better mannner, let us take an example:
Abhijeet is 35 years old and incurs an expense of INR 70,000 on the medical treatment of a specific disease. He is eligible to claim a deduction of INR 40,000 under section 80DDB. Abhijeet also receives INR 25,000 as a 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 (40,000 – the amount received by the insurance company i.e. INR 25,000) under section 80DDB.
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 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 was to incur this expense for a senior citizen then, he will be permissible deduction under section 80DDB for Senior citizen will be upto Rs. 1,00,000)
Earlier a certificate was required to be obtained and submitted in Form No. 10-1 to claim this deduction, it has been duly omitted. So, you can obtain the same but it is not a requirement to submit the form along with income tax return to claim the deduction.
Acquire Certificate for Claiming Deduction Under Section 80DDB
Here is the list of people from whom you need to acquire the certificate:
|Disease||Eligible person to ask for a certificate|
|Neurological Diseases where the disability level is proved to be of 40% and above||A neurologist who has an MD degree in Neurology. Or any equivalent degree that’s recognised by Medical Council of India.|
|(b) Dystonia Musculorum Deformans|
|(c) Motor Neuron Disease|
|(h) Parkinsons Disease|
|Malignant Cancers||An oncologist who has an MD degree in Oncology. Or any equivalent degree that’s recognised by Medical Council of India.|
|AIDS (Full Blown Acquired Immuno-Deficiency Syndrome)||Any specialist who has a postgraduate degree in general or internal medicine. Any equivalent degree that’s recognised by Medical Council of India.|
|Chronic Renal Failure||A nephrologist who has an MD degree in Nephrology. Or a urologist who has a Master Chirurgiae (M.Ch.) degree in Urology. Or any equivalent degree that’s recognised by Medical Council of India.|
|Haematological Disorders||A specialist who has an MD degree in Hematology. Or any equivalent degree that’s recognised by Medical Council of India.|
What Should the Certificate Contain?
The acquired certificate must have the following details:
- Name and Age of Patient
- Name of the Disease
- Details of the specialist issuing the prescription, i.e. Name, Address, Registration Number, Qualification
- The name and address of the hospital if the treatment was taken in a government hospital
ITR Form Applicable for Section 80DDB
The taxpayer can claim deductions u/s 80DDB while filing ITR if all the above-mentioned conditions are full-filled. Individuals/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. The due date for filing ITR is 31st July of the next FY if the tax audit is not applicable.
It is mandatory for the assessee to provide proof of expenditure such as medical bills along with the common documents to file ITR such as Form 16, PAN, etc. Therefore, it is compulsory to obtain a prescription for such treatments from a qualified doctor.
Specified diseases such as AIDs, cancer, dementia, neurological diseases etc. are covered under 80DDB.
No, you cannot claim Deductions on both Section 80D and Section 80DDB. Note that Section 80D allows claiming Deductions on general Medical Expenses whereas Section 80DDB allows Deductions for treatment of specific diseases only. It is also important to note that the amount of deduction claimed will be reduced by the amount received from an insurer or reimbursed by the employer for the medical treatment of the said person.
The Deduction amount will depend on the severity of disability/disease. For Senior Citizens, the deducted amount is INR 1,00,000. Individuals below 60 years are entitled a deduction of INR 40,000.
No, section 80DDB only covers Malignant Cancer.