Deduction under section 80U of Income Tax act 1961 can be claimed by an Individual who is a resident in India for the financial year relevant to the assessment year in which the person is taking the benefit.
Who can claim tax deduction of Section 80U
A salaried or self employed person or any other individual who is suffering from physical disability as specified under section 80U can claim income tax deduction under this section if such individual is resident in India during the financial year.
As per section 80U of Income tax act 1961, a foreign citizen who is resident in India during the financial year can also claim this income tax benefit for his physical disability.
Deduction under section 80U is not available to the individual who is non resident in India during the financial year.
Definition of Disability – Section 80U
The taxpayer will be covered under section 80U of Income Tax act 1961 if he or she suffers 40% or more of one or more physical disability any of the following;
- low vision;
- hearing impairment;
- locomotor disability;
- mental retardation;
- mental illness
The taxpayer has to keep a copy of the certificate issued by medical authority and such certificate has to be renewed in timely manner to keep claiming the income tax deduction under section 80U.
You are not required to produce this certificate along with the income tax return. In case it is asked by the assessing officer then the same has to be produced before him.
Quantum of tax deduction – Section 80U
A fixed tax deduction of Rs. 75, 000 is available for the taxpayer with disability if all of the other conditions mentioned under section 80U is satisfied.
A higher tax deduction of Rs 1, 20,000 can be claimed under section 80U if the taxpayer has severe disability. Sever disability means having any of the above disability of 80% or above.
This limit of 75000 and 125000 rupees has been increased in finance budget 2015 from the last year limit of Rs 50000 and Rs 100000 respectively. So for assessment year 2015-2016, tax deduction under section 80U will be Rs 50000 or Rs 100000 as the case may be . From assessment year 2016-2017 , Rs 75000 or Rs 125000 can be claimed as tax deduction under section 80U on the basis of percentage of physical disability as discussed above.
This means for assessment year 2015-2016, a fixed tax deduction of Rs. 50, 000 is available for the taxpayer with disability if all of the other conditions mentioned under section 80U is satisfied. A higher tax deduction of Rs 1, 00,000 can be claimed for assessment year 2015-2016 i.e. financial year 2014-2015 under section 80U if the taxpayer has severe disability.
FAQ on Section 80U – Tax deduction for a Physically Disabled Person
Question 1: What are the documents required to claim tax deduction under section 80U for my disability?
Answer: You are not required to produce any document to claim income tax deduction under section 80U. You need to keep the certificate which your medical authority has issued to you by certifying your disability. For illness such as autism or cerebral palsy form 10-IA additionally need to be filled up.
Question 2: Who CAN certify my disability to claim the benefit of tax deduction under section 80U?
Answer: Following medical authority persons can certify your disability to claim income tax benefit or tax deduction under section 80U;
- A civil surgeon or the chief medical officer of a government hospital
- A neurologist with an MD in neurology
- A pediatric neurologist having an equivalent degree.