Section 80DDB of Income Tax Act (2023 Guide)
The recent global health crisis has increased reliance on health insurance to save as medical costs are shooting up. Section 80DDB provides tax deductions to individuals who cannot pay regular health insurance premiums. Section 80DDB of Income Tax Act allows the taxpayer to take a tax deduction for the treatment of certain medical conditions.
What is the 80DDB deduction in income tax?
Section 80DDB of Income Tax Act provides a deduction to an individual or Hindu undivided family, who is a resident in India for the amount actually payable during the previous year, for the medical treatment of such disease or ailment in the rules made on this behalf by the board-
- Himself or a dependent, if the assessee is an individual; or
- Members of an undivided Hindu family, if the assessee is an undivided Hindu family.
Subject to a maximum of Rs. 40,000
( For senior citizens Rs, 1,00,000)
Who can claim a deduction under 80DDB?
The Section 80DDB tax deduction applies only to:
- Hindu Undivided Families (HUFs)
A tax deduction can be claimed if the relevant legal entity is a resident of India in that tax year and the medical expenses are related either to an individual or a HUF or a dependent such as a spouse, parent or sibling.
This section does not apply to non-resident Indians.
What is the limit of 80DDB?
The amount of deductions under Section 80DDB depends on the age of the person incurring the medical expense/treatment.
In case of medical expenses incurred by the individual or his/her dependents or HUF members, the deductible amount is limited to the actual amount incurred, or Rs.40,000, whichever is less.
For the purpose of this section:
- Senior Citizen means a resident Indian who has reached the age of sixty (60) years or older at any time during the preceding year.
- Super Senior citizen means a resident Indian who has reached the age of 80 years or older at any time during the relevant previous year.
Therefore, the amount of deductions claimed pursuant to Section 80DDB is as follows:
|Age of the person availing medical treatment||Deduction Amount (Rs.)|
|Age less than 60 years||Rs.40,000 or actual expenses, whichever is less|
|Senior Citizens- Age 60 years and above||Rs.1,00,000 or actual expenses, whichever is less|
Super Senior Citizens- Age 80 years and above
|Rs.1,00,000 or actual expenses, whichever is less|
What diseases are covered by 80DDB?
Income Tax Department publishes the eligible list of diseases. The list includes
- Neurological diseases with a certified disability level of 40% or higher.
- Dystonia Musculorum Deformans
- Motor Neuron Disease
- Parkinson’s Disease
- Malignant Cancers
- Full Blown Acquired Immuno-Deficiency Syndrome (AIDS)
- Chronic Renal failure
- Hematological disorders
The taxpayer must provide proof of the disease via a certificate to claim the Section 80DDB deduction. This information should be provided by the physician who supervised the disease/treatment.
What documents are required for 80DDB?
Documents to claim the 80DDB deduction are:
1. Medical Certificate
Taxpayers must provide a medical certificate from a licensed medical practitioner to the Income Tax Department while filing their tax returns. This serves as evidence for the medical care or the actual treatment.
Check out the list of diseases and the certificate that the doctor must provide.
Neurological Disease: A Neurologist’s prescription (Doctorate of Medicine in Neurology or any equivalent degree).
Malignant Cancer: A prescription from an oncologist (medical doctor in oncology or other equivalent degrees).
Severe Renal Failure: A Nephrologist’s prescription (Doctorate of Medicine in nephrology or other equivalent degrees). Otherwise, a Urologist’s prescription (Master of Chirurgiae or other equivalent degrees).
Haematological Disorders (Thalassaemia and Hemophilia): A specialist’s prescription (Doctorate of Medicine Degree in Hematology or other equivalent degrees).
AIDS: A prescription from a doctor (postgraduate degree in general medicine or internal medicine, or other equivalent degrees).
2. Document of Self-Declaration
You must submit a self-declaration. This document serves as proof of incurred medical expenses. Therefore, this document should include all medical expenses, including training and rehabilitation for family members with disabilities.
3. 80DDB Form
Under the new rules, you are no longer required to submit a prescription and Form 10-1. But if a dependent has a disability like autism or cerebral palsy, it is essential.
4. Paid Insurance Premium Receipts
To qualify for a tax deduction under section 80DDB for an insurance policy, you must submit the receipts for the paid insurance premiums.
What should be mentioned in the prescription?
Prescriptions must be obtained from a qualified specialist with appropriate expertise. A prescription issued in connection with an illness or condition must contain the:
- Patient’s name
- Patient age
- Disease or Ailment name
- Prescribing specialists must provide their name, address, qualifications, and registration number.
- If treatment is provided in a public/government hospital, the name and address of the hospital must be provided.
The respective hospital specialist must sign the form.
While filing an income tax return, submit this prescription form to the income tax department. Keep a copy of the prescription for future use since no documents are attached to ITR.
How to Fill Section 80DDB Form
Form 80DDB consists of a variety of information that must be filled in to claim your deduction. Also known as Form 10-I.
Download Form 10 I from here.
The process for filing the 80DDB form is as follows:
1: Enter the applicant’s name.
2: Enter the applicant’s father’s address and name.
3: Enter the name and address of any dependents of the applicant and their relationship to the applicant.
Step 4: Please refer to Rule 11DD before filling in the column with the name of the disease or condition.
5: Mention if you have more than 40% disability due to illness or disease.
6: Enter the certified specialist’s name, address, medical registration number, qualifications, and name and address of the government hospital.
7: Then fill in the verification section with the appropriate signs indicating that the information provided is correct.
Frequently Asked Questions (FAQs)
Can we claim both 80d and 80DDB?
Yes, you can claim deductions under both Sections 80D and 80DDB.
Can medical bills be claimed under 80DDB?
Yes, you may receive a tax deduction under Section 80DDB for the cost of treating certain medical conditions.
Can I claim 80DD and 80DDB for the same person?
Yes. But only if other conditions are fulfilled.
Is COVID under Section 80DDB?
No, COVID-19 is not included in the 80DDB. However, there is a new proposal considering the inclusion of COVID-19 in Section 80DDB.
Can I claim dental treatments under section 80DDB of the Income Tax Act?
No, you cannot claim dental treatments under section 80DDB.
Section 80DDB allows individuals and HUFs to deduct medical expenses for themselves or their dependents from their gross income when calculating taxable income. The government plans to expand tax incentives to help patients suffering from the current health crisis. So keep the above tips in mind to enjoy her 80DDB deduction without any problems.
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