Several sections of the Income Tax Act provide benefits to people with disabilities. One of these is Section 80U Income Tax. If the taxpayer is disabled, they can claim a deduction under this section to reduce the amount of tax paid. In this article, we have discussed the 80U deductions, limits, and various aspects of it.
What is an 80U?
Section 80U of the Income Tax Act of 1961 contains provisions regarding tax relief benefits for individual taxpayers who suffer from a disability.
Section 80U provides deductions for a resident with 40% or more of disability for either blindness, visual impairment, leprosy, hearing impairment, motor impairment, intellectual disability, or mental illness.
The requirements to claim this deduction are:
- Taxpayers must be residents.
- Taxpayers must be suffering from at least 40% disability.
- The disability must be certified by an accredited medical institution.
What is the limit for 80U?
The relief under Section 80U is divided into two parts. These are for:
Persons With Disabilities
Individuals with 40% disability can claim ₹75,000 as a deduction under section 80U.
Persons With Severe Disabilities
Individuals with more than 80% disability can claim ₹1,25,000 as a deduction under section 80U.
Sections of the Income Tax are closely related to section 80U and the deductions are largely interdependent.
Which disabilities can be claimed under 80U?
A taxpayer can claim tax benefits for the following disabilities under section 80U:
Blindness: Blindness is a total loss of vision, a field of vision restriction of 20 degrees or more, or visual acuity of less than 6160 after corrective lenses.
Low Vision: People with visual impairments that cannot be fully corrected by surgery or standard refractive corrections. People with this disability are able to use their vision using other devices.
Leprosy Cured: People who have recovered from leprosy disease but still have disabilities such as loss of sensation in their feet and hands, and paralysis of their eyelids and eyes. This includes the elderly or those with severe deformities that prevent them from pursuing meaningful employment.
Impaired hearing: Hearing loss of at least 60 decibels.
Mental Illnesses: Different mental illnesses are unrelated to mental retardation.
Mental disorder: A person with incomplete or delayed intellectual development and a subnormal level of intelligence.
Locomotor Disability: Individuals whose joints, muscles, or bones significantly limit their range of motion.
Autism: Autism spectrum disorders are about brain development that affects how a person perceives and connects with others, leading to problems with social interaction and communication.
Cerebral palsy: CP is a group of movement disorders that appear in infancy. Signs and symptoms vary from person to person and over time but include incoordination, muscle stiffness, muscle weakness, and tremors. sensation, vision, hearing, and speech problems can occur.
What documents are required to claim tax benefits under section 80U?
Below is the requirement of list of documents to apply for the 80U deduction.
- Medical certificate of disability (for general disability).
- Form 10-IA for People with Severe Disabilities (as per Section 139 of the Income Tax Act)
How to claim deduction under Section 80U?
The person claiming the deduction must submit a copy of the certificate issued by the medical institution along with the ITR. It is rarely necessary to attach documents to the ITR. We recommend that you keep the documentation handy.
Please note that you will need to submit a medical certificate of disability. The certificate must be issued by an accredited medical institution in the prescribed format contained on Form 10-IA. The form is available on the Income Tax website.
Therefore, if you have made a deduction under this section, it means that you have a certificate from the Authorized Medical Practitioner.
We also recommend that you keep your doctor’s prescriptions and medical records safe in case the Income Tax Department requests them in the future.
The medical certificate should include information about the taxpayer’s disability.
The certificate of disability has a set period of validity. If the certificate expires during the fiscal year, the deduction for this fiscal year can be claimed on the expired certificate. However, starting in the following fiscal year, you will need to request a new certificate to claim your Section 80U deduction for the following year.
Which medical authorities are authorized to issue certificates under Section 80U?
The medical authorities listed below are qualified to issue a medical certificate:
Civil Surgeons or Chief Medical Officers (CMOs) of public hospitals.
A neurologist with a medical degree in neurology.
Children’s Pediatric Neurologist
What is disability as per 80DD?
The definition of disability in Section 80DD is derived from Section 2(i) of the Persons with Disabilities Act 1995 (Equal Opportunities, Protection of Rights and Full Participation).
Section 80DD provides tax benefits for families caring for dependents with disabilities. Both caregivers and Hindu undivided families (HUF) can claim.
What is the difference between section 80DD and section 80U?
- Section 80U provides tax relief for persons with disabilities.
- Persons with disabilities can claim for themselves the benefits provided under Section 80U.
- Section 80DD provides for the dependent exemption for disabled persons.
- Section 80DD applies when a taxpayer pays certain amounts for insurance to care for a dependent disabled person.
The deductible limit under Section 80DD is the same as Section 80U.
Dependents in this context are siblings, parents, spouses, children, or other members of the Hindu undivided family.
Frequently Asked Questions (FAQs)
Is paralysis covered under 80U?
Yes, Section 80U of the Income Tax Act of India, 1961, covers paralysis.
Can Non-Resident Indians claim deductions under Section 80U?
No, Non-Resident cannot Indians claim 80U deductions.
Can I claim both 80d and 80U?
No, you cannot claim sections 80D and 80U simultaneously.
What if the disability certificate expires in the current year?
You can claim an exemption based on an expired certificate for the current year, but in the next year, you must obtain a new certificate.
Are deductibles based on the actual expenses incurred?
No, flat deductions are permissible regardless of disability treatment or maintenance costs.
Deductions help reduce your tax liability. Expense-specific deductions can be understood as deductions encouraged by the Indian government by allowing tax deductions for expenses such as his 80C, while other types of deductions meet certain requirements to reduce the tax burden. Such deductions are provided for in Section 80U.