What kind of disability expenses can be deducted under section 80DD?

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Section 80DD of the Income-Tax Act of 1961 allows all Indian residents to seek tax deductions for medical expenses. Medical certificates, medicine invoices, and other supporting documentation must be submitted to claim the deduction.

Today, medical treatment has become increasingly expensive in recent years, making it a challenging service to obtain for the poor and middle classes of Indian society.

The Indian government, to provide some relief to specific groups of people, particularly those who are disabled or have a severe condition, may now be able to do so through Section 80DD of the Income-Tax Act, 1961. Before going into more detail, it’s important to note that while the income tax rates have changed and small revisions have been made, the legal and relief aspects of the tax have remained the same since 1961.

Expenses that are deducted in the calculation of Income Tax

The following expenses are exempted for income tax under section 80DD:

-Any expenses incurred for medical treatment, including nursing, training, and rehabilitation of a disabled dependent.

-The sum paid to the Life Insurance Corporation (LIC), Unit Trust of India, or any other insurer for the sole purpose of purchasing specific schemes or insurance policies to assist in support of a disabled dependent.

According to tax legislation, who qualifies as a disabled dependent?

If a person meets the following criteria, they can be classified as a disabled dependant under section 80DD, allowing the person’s carer to claim income deductions:

-Individuals, such as your husband, son or daughter (or any child), parents, and brother or sister (or siblings) might all be considered disabled dependants.

-This applies to any Hindu undivided Family (HUF), which means that any member of the HUF might be a disabled dependent.

-It is critical that the impaired person be entirely or mostly reliant on the taxed for support and upkeep.

-He should also refrain from claiming the deduction under section 80U.

What is considered a disability or a severe disability under Section 80DD?

The “Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995” defines disability in clause I of section 2 as well as disabilities defined in clauses (a), (c), and (h) of section 2 of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation, and Multiple Disabilities Act, 1999.

As a result, the following disabilities are included:

Mental illnesses that are severe or cognitive in nature

Blindness due to low vision

Leprosy-cured

Impairment in hearing

Disability of locomotion

Autism

Cerebral palsy is a condition that affects the brain.

Alternatively, you may have many disabilities.

It is critical to remember that a person cannot have less than 40% of any aforementioned disabilities. When it comes to severe disability, 80% or more of one or more of the illnesses or disabilities stated is taken into account.

Amount of Deduction under Section 80DD

The deduction amount under Section 80DD of the Income Tax Act of 1961 is determined by whether the dependant is disabled or has a severe disability.

-Dependant person with a disability – A dependant person with a disability has at least 40% of the disabilities listed. A family member who pays for the medical expenses of a disabled dependant can claim a tax deduction of up to Rs. 75,000.

-Dependant person with severe disability – A dependent person with a severe disability has at least 80% disability. A family member responsible for the medical expenses of a dependent individual with a severe disability is eligible for a tax deduction of up to Rs. 1,25,000.

Documents required to claim a section 80DD tax deduction

To claim tax benefits under Section 80DD of the Income Tax Act of 1961, the following documentation must be submitted:

Medical certificate: To claim a tax deduction under Section 80DD, the taxpayer must provide a copy of the medical certificate that verifies the dependant’s handicap.

Form 10-IA: If the impaired dependent has autism, cerebral palsy, or multiple disabilities, Form 10-IA must be completed and filed.

Self-Declaration certificate: Taxpayers must submit a self-declaration certificate detailing the expenses of the disabled dependant’s medical treatment (including nursing, rehabilitation, and training).

The insurance premium paid receipts: Because the self-declaration certificate will suffice for most expenses, the individual does not need to keep the actual receipts. If a claim is submitted for payments made toward insurance policies purchased for a disabled dependent, the original receipts for the expenses must be kept.