Section 80U of the Income Tax Act offers tax benefits if an individual suffers a disability. If you have a certified disability of at least 40%, you can claim an 80U deduction of up to Rs.75000 on your income. The tax deduction under Section 80U of the Income Tax Act, 1961 provides much-needed financial support to taxpayers who face the challenges of disabilities.
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Save upto Rs 46,800in Tax under section 80 C
Persons with a disability, also abbreviated as PwD, are defined under the Persons with Disability (Protection of Rights, Full Participation and Equal Opportunities) Act, 1995.
To qualify for an 80U deduction, you should have a disability as defined under the Income Tax Act 1961.
Definition: Any person suffering from at least 40% disability as certified by appropriate medical authorities is defined as a disability.
Under the 80U Section, disability is mainly categorized into 7 types:
Low Vision: Low vision is applicable to you if you have visual function impairment, which cannot be corrected by any surgery, but you still have the capability to use your vision via assistance from other devices.
Blindness: This disability is referred to as a complete field of limitation of vision or lack of sight by 20 degrees of angle or worse than this, or visual acuity not more than 6160 after the corrective lenses.
Hearing Impairment: You are certified as hearing impaired if you have a hearing power of not more than 60 decibels.
Leprosy Cured: You are called leprosy cured if you have been cured of leprosy, but your sensation in your hands or feet has been lost, and you have paresis in the eye or eyelid. In addition, you should have intense deformities that may obstruct the performance of any beneficial occupation.
Mental Retardation: You are declared mentally retarded if you have arrested development or incomplete development of mental abilities that results in subnormal levels of intelligence.
Loco Motor Disability: In this case, you may have strictly limited limb movement because of a disability of joint bones or muscles.
Mental Illness: Mental disorders other than mental retardation.
The law of the Government of India also defines severe disability other than disability. It is defined as the condition where you may suffer from 80% or more disabilities in the categories mentioned above. This severe disability also includes the following:
Cerebral palsy, and
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|Disabled Person (40 percent disability)||Rs. 75,000|
|Severely Disabled Person (80 percent disability)||Rs. 1.25 lakhs|
Government employees and other taxpayers must submit the following document to register the claim with the 80U income tax:
Disability certificate in Form 10-IA (issued by a recognized medical authority)
Form 10-IA is a medical certificate form that is used to certify the disability of a person for the purpose of claiming tax deductions under Section 80U. The certificate must be signed by a medical authority recognized by the Central Government.
The following authorities are allowed to issue a valid medical certificate for the purpose of Section 80U:
A civil surgeon
the Chief Medical Officer (CMO) of a government hospital
a neurologist holding an MD in Neurology
a paediatric neurologist for children
The key differences between the Section 80U and Section 80DD are as follows:
|Feature||Section 80DD||Section 80U|
|Eligibility||Resident individuals and HUFs with a disabled dependent||Resident individuals who are disabled|
|Disability||The disability of the dependent must be at least 40%||The taxpayer's own disability must be at least 40%|
|Expenses||The deduction is allowed for medical expenses, maintenance expenses, and education expenses incurred for the disabled dependent.||The deduction is allowed for medical expenses and maintenance expenses incurred by the taxpayer for themselves.|
|Deduction limit||The deduction limit is Rs. 1.25 lakh for severe disability and Rs. 75,000 for moderate disability.||Up to Rs. 75,000 (Rs. 1.25 lakhs for severe cases)|
|Documents required||A copy of the disability certificate issued by a recognized medical authority in Form 10-IA||A copy of the disability certificate issued by a recognized medical authority in Form 10-IA|
Rs. 75,000 for a person with a disability of at least 40% but less than 80%.
Rs. 1,25,000 for a person with a severe disability of at least 80%.
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
*Tax benefit is subject to changes in tax laws. Standard T&C Apply
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