Deduction under Section 80U for Person with Disability under IT Act:
If a person is suffering from at least 40% disability, he/she can claim a tax deduction upto Rs.75, 000 on the taxable income under section 80U.
What is section 80U?
Section 80U of the Income Tax Act, 1961 includes provisions for tax deduction benefit to individual taxpayers suffering from a disability. In order to claim tax deduction under section 80U, the individual must be certified as a person with a disability by appropriate medical authority.
Who is a person with a disability?
As per the Persons with Disability (Equal Opportunities, Protection of Rights and Full Participation) Act, 1955, individuals suffering from any of the following ailments with minimum 40% impairment will be considered as disabled:
- Low Vision
- Leprosy (cured)
- Hearing Impairment
- Locomotor Disability
- Mental Retardation
- Mental Illness
- Cerebral Palsy
The disability act also provides a definition of severe disability which refers to the condition where the disability is 80% or more. A person suffering from multiple disabilities will also be considered as severely disabled.
Deduction Limit under Section 80U
Person with Disability: If a person is suffering from at least 40% disability, he/she can claim a tax deduction up to Rs.75,000 on the taxable income under section 80U.
Person with Severe Disability: If a person is suffering from severe disability i.e suffering 80% disability (either from one or multiple ailments) can claim a tax deduction upto Rs. 1.25 lakh under section 80U.
|Type of Disability||Deduction Limit Under Section 80U|
|General Disability||Rs. 75,000|
|Severe Disability||Rs. 1.25 lakh|
Documents Required to Claim Tax Benefits under Section 80U
Apart from the disability certificate issued by a medical authority, there are no other documents required for claiming tax deductions under section 80U. However, in case of illness such as autism and cerebral palsy, Form 10-IA additionally needs to be filled up.
What constitutes a medical authority?
Medical authorities mentioned below are eligible to issue a medical certificate:
A civil surgeon or Chief Medical Officer (CMO) of a government hospital
A neurologist with an MD in Neurology
A Pediatric Neurologist in case of children
What if my disability certificate gets expired in the current year?
In case the disability assessment certificate gets expired, you can still claim tax deduction under section 80U in the year in which the certificate gets expired. However, you must get it reissued for claiming tax benefits in the subsequent years.
What is the difference between section 80DD and section 80U?
Although both the sections provide income tax deduction on the grounds of disability, the beneficiaries under the respective sections are different. Under section 80U, individual suffering from a disability can claim for tax deductions for self only. While under Section 80DD, dependent family members of the individual suffering from the disability can claim the tax deduction.
(Contributed by Er. HARCHANDAN SINGH, SG RSCWS, ASG BPS. GS IRTSA, 32 Phase 6, Mohali (Chandigarh) – 160055)