An individual suffering a disability can claim tax deduction under section 80U of the Income tax act, 1961. In this article, we will be discussing what are the tax benefits an individual with disability can claim and what are the conditions such person has to satisfy before claiming tax deduction.
Who can take benefit of tax deduction under section 80U?
As per the provisions of section 80U of the Income tax act, 1961, a resident individual can claim tax deduction based on their disability.
A person will be considered as a person with disability for the purpose of section 80U if such taxpayer suffers 40% or more of any of the following disability;
- Low vision
- Hearing impairment
- Loco motor disability
- Mental retardation
- Mental illness
Amount of tax deduction for a person with disability under section 80U
A resident individual with 40% or more of any of the above mentioned disability, can claim a fixed tax deduction of 75,000 rupees.
If the resident individual is having any of the above disability of 80% or above, then they can claim a fixed tax deduction of 1,25,000 under section 80U of the income tax act, 1961.
Please note, section 80U tax deduction is in addition to all other eligible tax benefits such as section 80C.
How to claim tax deduction under section 80U
To claim tax deduction under section 80U, you are required to file your income tax return. You need to specify the amount of deduction you want to claim in your tax return.
You are also required to collect a certificate certifying the disability from a recognized medical authority in Form 10-IA. If the disability require assessment, then such certificate must be obtained for the assessment year.
You are not required to produce any bills for the cost incurred for the pursuance of treatment as benefits under section 80U is a fixed tax deduction.
Following medical authorities can issue disability certificate in order to claim tax deduction under section 80U;
- A neurologist who has a degree of MD (Doctor of Medicine) in Neurology
- A civil surgeon in a government hospital
- A Chief Medical Officer in a government hospital
- A pediatric neurologist who has a degree of MD (Doctor of Medicine) in Neurology in case of disabled children
We have one more section 80DD with which people are confused as the deduction limits are same.
Please note, section 80DD is for a taxpayer whose family members or kin is suffering with disability and the taxpayer deposits a specified amount as an insurance premium for taking care of the dependent disabled person.