Section 80DDB Deduction – Tax Deduction for Specified Diseases
Section 80DDB Deduction – Tax Deduction for Specified Diseases
Section 80DDB is a section introduced in the Income Tax Act for allowing individuals suffering from specific diseases to claim a deduction from the taxable income. For certain specific diseases, the Government offers tax deduction to individuals and HUFs under Section 80DDB on the basis of expenses incurred for the treatment of the illnesses mentioned in the Act. As per section 80DDB of the Income Tax Act, a person can claim deductions for medical expenses either for himself or dependents. Dependants include spouse, parents, children or dependent siblings. The assessee shall be permitted to claim a deduction only if the residency status of the assessee is reflected as ordinarily resident in the records of the Income Tax Department. For the purpose of claiming a deduction under this section, the assessee should either be an individual or a Hindu Undivided Family (HUF).
Eligibility
- Tax deduction under section 80DDB is available to all resident individuals as well as HUFs.
- The expenditure is incurred for medical treatment of the assessee himself or dependent husband/wife, children, parents, brothers and sisters of the taxpayer.
- Tax benefits under this section isnot available to NRIs. Thus the assessee has to be an Indian resident.
- In case the assessee is an individual, the assessee can claim a tax deduction expenses have been incurred for the assessee’s own treatment or the treatment of a dependent.
- In case the assessee is an HUF, it can claim tax deduction for the expenses incurred in the treatment of any member of HUF. Once the deduction is allowed in the return of the HUF the same amount cannot again be claimed by a member of the HUF.
Deduction Limit
If the eligibility conditions are satisfied, actual expenditure on medical treatment is tax deductible under Section 80DDB subject to the below limits. If the assessee has received any amount from an insurance or been reimbursed by an employer, that amount should be reduced from the deduction claimed.
| Assessment Year | Regular Taxpayer | Senior Citizen | Super Senior Citizen |
| AY2015-16 | 40,000 | 60,000 | 60,000 |
| AY2016-17 & AY2018-19 | 40,000 | 60,000 | 80,000 |
| AY2019-20 | 40,000 | 1,00,000 | 1,00,000 |
Dependent under Section 80DDB Deduction
For the purpose of this section, dependents fall into two categories:
- For individuals, a disabled dependent can be a spouse, son/daughter (any child), parents, brother/sister (siblings).
- For HUFs, a disabled dependent can be any member of the HUF.
Diseases Covered under Section 80DDB
Taxpayers can claim deductions for the treatment of a wide range of specified diseases, which include:
| Disease | Requirement for Claiming Deduction |
|
Neurological diseases where the disability level has been certified to be of 40% and above: a. Dementia b. Dystonia Musculorum Deformans; c. Motor Neuron Disease; d. Ataxia; e. Chorea; f. Hemiballismus; g. Aphasia; h. Parkinsons Disease |
Prescription from a Neurologist having a DM degree in Neurology or any equivalent degree. |
| Malignant Cancer | Prescription from an Oncologist having a DM in Oncology or any equivalent degree. |
| Full-blown AIDS | Prescription from a Specialist having post-graduate degree in General or Internal Medicine. |
| Chronic Renal Failure | Prescription from a Nephrologist having a DM in Nephrology or a Urologist having a Master of Chirurgiae degree in Urology |
| Hemophilia or Thalassaemia | Prescription from a Specialist having a DM in hematology. |
Medical Certificate for Claiming Deduction
The prescription must contain the name and age of the patient, name of the disease or ailment along with the name, address, registration number and the qualification of the specialist issuing the prescription. If the patient is receiving treatment in a government hospital, the prescription should be issued by any specialist working full-time in that hospital and having a post-graduate degree in General or Internal Medicine or any equivalent degree, which is recognised by the Medical Council of India. Where the patient is receiving treatment in a government hospital, the prescription should also contain the name and address of the government hospital.
Conditions for Tax Deduction under Section 80DD
- The taxpayers have to furnish a hard copy of the medical certificate that states the disability as issued by the Central or the State government medical board.
- The insurance plan must be in the tax assessor’s name and the plan should be a life insurance policy and not a health insurance policy.
- In case of untimely death, the plan should pay the annuity or single lump sum amount as a death benefit for the disabled dependent.
- If the disabled person dies prior to the taxed individual, the policy amount is returned to the concerned person. Hence, the refund would be considered as income and therefore taxed for income tax purposes.
Documents Required
A taxpayer requires the following documents to claim tax benefits under Section 80 DD.
Medical Certificate
The taxpayer is required to produce/ submit a medical certificate stating the disability from a certified medical authority as per the law. This certificate can be received from the following people:
- A neurologist qualified with a Doctor of Medicine (MD) degree in Neurology or a Pediatric Neurologist with a similar degree for children.
- A Civil Surgeon or a Chief Medical Officer (CMO) of any government hospital.
Form 10-IA
This form will be needed if the dependent is suffering from Autism, Cerebral Palsy or multiple disabilities.
Click here to download the form.
Self Declaration Certificate
The taxpayer has to submit a self-declaration certificate that states all the medical expenses including for the training and rehabilitation of the disabled dependent were genuinely incurred.
Receipts of Insurance Premium Paid
This document is not mandatory since all the medical expenses are mentioned in the self-declaration certificate. However, if the taxpayer needs to claim any deduction payment towards any insurance policies that have been taken for the disabled dependent, then these receipts are required.
To know about Advance Tax payments, click here.
