Section 80U - Tax Deduction for Disabled Individuals
The income tax rules of India contain provisions that offer tax benefits to those with a disability, either themselves or through family members.
In the event that an individual taxpayer becomes disabled, Section 80U provides tax advantages; in the event that an individual taxpayer's dependent family member(s) becomes disabled, Section 80DD provides tax benefits. The main topic of this essay is the tax advantages provided by Section 80U.
Who is Eligible for Section 80U Deductions?
Section 80U permits a resident who has received medical authority certification as a person with a handicap to claim the tax benefit. A person who is certified by medical authorities to have a handicap of at least 40% falls under the definition of a person with a disability for the purposes of this section.
One of the following definitions of disability has been applied for the purposes of this section:
Blindness
Low vision
Leprosy-cured
Hearing impairment
Loco motor disability
Mental retardation
Mental illness
A definition of a severe disability is also given in this section, and it pertains to a condition in which the impairment is 80 percent or more. Multiple impairments, autism, and cerebral palsy are also considered severe disabilities.
Quantum of Deduction Under 80U
Individuals with disabilities are eligible for a flat deduction of ₹ 75,000, while those with severe impairments are eligible for a flat deduction of ₹ 1,25,000.
Requirements to claim Deductions Under Section 80U
Further than the certificate of disability from an accredited medical authority on Form 10-IA, no further evidence is needed. For costs related to continuing treatment or any related expenses, invoices are not required.
The medical certificate attesting to the disability and the income tax returns filed in accordance with Section 139 for the applicable AY are required in order to file a claim under this section. Should the disability assessment certificate expire, the deductions can still be made in the year of the certificate's expiration. To collect the benefits under Section 80U, however, a new certificate from the following year would be needed.
The medical authorities, who may be a civil surgeon or the chief medical officer of a government hospital, or a neurologist holding a Doctor of Medicine (MD) in Neurology (or, in the case of children, a pediatric neurologist with an equivalent degree), could grant certificates.
Only those who want to use the previous tax system are eligible to claim this deduction.
The certificate's validity begins in the assessment year relevant to the financial year in which it was issued and ends during the assessment year relevant to the financial year in which the certificate expires if the disability is temporary and calls for reassessment after a predetermined amount of time.
Which Medical Authority can grant Section 80U Certificates?
The following medical authorities are qualified to issue a disability certificate:
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 the case of disabled children
What is the difference between Section 80U and Section 80DD?
Under section 80TTB, a resident senior adult who reaches sixty or older at any point during the fiscal year is eligible to deduct.
A deduction of up to ₹ 50,000 is permitted under Section 80TTB.
Section 80GG – Income Tax Deduction on House Rent Paid
While Section 80U allows tax deductions for the individual taxpayer with a handicap, Section 80DD allows deductions for the person's family members and kin.
If a taxpayer pays a certain amount as an insurance premium for caring for a dependant who is disabled, then Section 80DD is relevant. The deduction limitations under Section 80DD are the same as those under Section 80U. In this context, a dependant might include an assessee's siblings, parents, spouse, kids, or a member of a Hindu Undivided Family.
To put it another way, if a person pays for a dependent relative and gets a deduction under section 80DD, the dependent relative will not be able to claim a deduction under section 80U for their handicap.
A taxpayer may only claim a deduction under Section 80U or 80DD if they choose to use the Old tax regime.
FAQs
Section 80U of the Income Tax Act permits a deduction for a person with a designated disability that results in at least 40% of disability.
When declaring income on an income tax return, an individual or person with a physical disability may claim the deduction under section 80U.
Along with the income tax return, the taxpayer is required to include a copy of a medical certificate under section 80U. The handicap and the approved medical authority should serve as the foundation for the medical certificate. The income tax return must be provided with Form-10IA, on which the certificate must be presented.
A handicapped person is eligible for a deduction of ₹ 75,000. If a person has an 80% disability, they will deduct ₹ 1,25,000.
No, you are unable to deduct from each of these areas simultaneously.
No, you only need to present a medical certificate as verification because this part offers a flat deduction based on the percentage of incapacity.
Both portions are equally advantageous since they offer the same maximum deduction. As a result, a person is eligible to get any tax advantage under any applicable law.
Yes, a person who is temporarily disabled may also benefit from tax benefits under this section as long as they present the medical certificate of disability issued by a designated medical authority together with their income tax return. The certificate must be valid from the date of issuance until the end of the financial year in which it was issued.
No, only under the previous tax system was the Section 80U deduction allowable.
No, residents alone are qualified to deduct under Section 80U.
