Eligible Assessee
This section is applicable to both Resident individual and HUF.
Eligible Amount of Deduction
- For normal disability flat deduction of Rs:75,000
- For Severe disability flat deduction of Rs: 1,25,000
Note
- Assessee should incur expenses on medical treatment or deposit any amount for maintenance of such handicapped dependent relatives.
- Here relatives includes Spouse, brother, sister, children, mother, father and any member in the case of HUF.
Disability or Severe Disability is considered under the Section 80DD:
Disability for Section DD is defined under clause (i) of section 2 by the “Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995” as well as disabilities includes in clauses (a), (c) and (h) of section 2 of National Trust for welfare of Person with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999.
Hence this includes the following disabilities:
- Cognitive or severe mental disabilities
- Low vision
- Blindness
- Leprosy-cured
- Hearing impairment
- Locomotor disability
- Mental illness
- Autism
- Cerebral palsy
- Or Multiple disabilities
It is essential to note that person must not suffer less than 40% of any of the above disabilities. When it comes to sever disability 80% or above of one or more of the mentioned illnesses or disabilities is considered.
Need Medical Certificate to Claim Deductions Under Section 80DD:
- A neurologist with a Doctor of Medicine (MD) degree in Neurology or a Paediatric Neurologist with a similar degree for children.
- A Civil Surgeon or a Chief Medical Officer (CMO) of any government hospital.
Conditions for Deduction under 80DD:
- People need to produce a hard copy of the medical certificate stating disability as issued by the central or state government medical board to make the deduction claim.
- The insurance plan should be in the tax assessor’s name and also must be a Life insurance policy and not a health insurance policy. It could also pay annuity or simple lump sum amount as death benefit for the disabled dependant in the case of your untimely death.
- In case the disabled dependent dies earlier than the taxed, the policy amount is returned to him or her and hence would be treated as income and hence taxed for income.
