When it comes to chronic diseases, a health insurance plan may not be enough. There are specific medical expenses and conditions that insurance policies may not cover. However, thanks to certain tax-saving methods, individuals can reduce their tax liability and save a significant amount on the high medical expenditures they have already paid.
Section 80DDB of the Income Tax Act, 1961 is one such provision that enables taxpayers to claim tax deductions for the expenses of specified ailments. Let us take a look at all its intricacies and how you can benefit from it.
Indian residents or HUFs can claim 80DDB deductions on medical expenditures for specified diseases under section 80DDB. Note that the amount of 80DDB deduction you can claim is dependent on two main aspects, a patient’s age and amount of expenditure.
Find the details of tax deductions under Section 80DDB below:
However, to avail of the benefits of such deductions, individuals must meet certain eligibility parameters. Find all these details in the following section.
Also Read – How To Pay Income Tax Online?
Taxpayers should meet these specific parameters mentioned below to claim tax deductions under section 80DDB:
Now that you are aware of the eligibility criteria of Section 80DDB, go through the following section to know the list of diseases this provision covers.
Also Read – Income Tax Slabs And Rates
It is necessary to get a certificate for the illness to claim deductions under Section 80DDB of the Income Tax Act. If the treatment is going on at a private hospital, the certificate can be obtained from a private doctor. Patients admitted to a government hospital need to acquire a certificate from a specialist.
Ensure that the medical specialist issuing such certificates possesses a postgraduate degree in General Medicine or any equivalent degree under the Medical Council of India.
The following details are to be included in the certificate as per the income tax department:
The name of the patient
The age of the patient
The name of the ailment or the disease in question
Details of the specialist such as:
If the patient is getting treated at a government hospital, then the name of the hospital, as well as its address, needs to be mentioned in the certificate.
Here are the diseases or ailments this particular provision of the Income Tax Act, 1961 covers:
These diseases are:
And, the disorders might include the following:
A specialist who is working in a private hospital, he/she must possess a degree in their field of specialisation that is validated by the Medical Council of India.
For specialists working in a government hospital, the specialist must possess a general post-graduate degree or an internal medicine degree or similar, again validated by the Medical Council of India.
Apart from the medical certificate provided by the medical professional, you need to submit some additional documents too. For instance:
Now that you clearly understand all the requirements to claim tax deductions under this provision, find some of its limitations in the next section.
Here are some of the limitations of this provision:
Also, keep in mind that for a HUF, once the deduction is permitted in a member’s tax returns, no other member can claim that particular amount again.
Section 80DDB was amended as per the Finance Act 2015. The amendment mentions that in order for people who suffer from medical ailments and for them to claim tax deductions, they need to provide a certificate, which they have acquired from a doctor who has specialized in that particular field of treatment.
Now that you are aware of all the information related to Section 80DDB of the Income Tax Act, 1961, it should be easier for you to save a substantial amount on high medical expenditures. To claim an 80DDB deduction, mention all the details properly while filing your annual income tax returns and avail of the benefits.
Ans: The certificate comprises the name and age of the patient, name of the ailment, medical specialist’s name, address, qualification, etc. Also, make sure that the head of the medical department of that particular hospital signs the certificate.
Ans: No, in case you or your family members reside outside India, the benefits of Section 80DDB will not be available. As per the rules of this provision, the taxpayer must be an Indian resident.
Ans: No, it is not possible to claim tax deductions for both Section 80U and 80DDB. Section 80U mainly deals with deductions for patients with a disability. On the other hand, Section 80DDB deals with tax deductions for medical expenses for the treatment of diseases specified under its tax provision. You can’t avail benefits of both these tax provisions simultaneously.
Ans: No, it will not be possible. The rules and regulations of Section 80DDB clearly state that you can only claim deductions for diseases that are covered under this provision. In the case of cancer, the tax deductions are only applicable if it is malignant in nature.
Ans: There is an age limit under Section 80DDB. Therefore, you need to check if the patient is above 60 years or below that. In case the age is above 60 years, you can claim the deduction for the entire amount, as the limit is Rs. 1 lakh.
Ans: Under 80DD, you can enjoy tax deductions on the medical treatments incurred on disabled dependents. While 80DDB ensures tax benefits on the medical expenses on both self or dependent’s medical treatment.
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
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