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Deduction under Section 80DD of the income tax act is allowed to Resident Individuals or HUFs for a dependent-who is differently-abled and– is wholly dependent on the individual (or HUF) for support & maintenance.
Below are the conditions you must meet to avail this deduction –
Fixed amount of deductions are allowed under Section 80DD, irrespective of the actual expenditure. However, the amount of deduction depends on the severity of the disability.
Note: Before the Financial Year (FY) 2015-16 (FY 2014-15 & earlier years) – The deduction limit was Rs 50,000 where disability was at least 40% and Rs 1,00,000 where there was more than 80% disability.
An individual who is certified as a person with a disability can claim tax benefits under Section 80U of the IT Act. Individuals can claim tax deduction under Section 80DD for bearing the expenses of the medical treatment of a disabled dependant. Whereas, under Section 80U, an individual certified as a person with a disability can himself claim the deduction.
It is important to understand that deduction under Section 80DD is not allowed if the dependant relative claims a deduction under Section 80U for himself.
The following disabilities are covered u/s 80DD of the IT Act, 1961:
You can claim full deduction of INR 75,000 or 1,25,000 irrespective of the actual expenditure.
You can claim expenses done for treatment, nursing, training, rehabilitation of the dependent along with insurance premium paid on plans specified for the dependent.
You only need a government issued disability certificate from a medical board to avail this benefit.