Section 80DDB Deduction: Diseases Covered Under Section 80DDB Of Income Tax Act
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.
Deductions Available on Section 80DDB
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:
- Individuals below 60 years of age will be able to claim an 80DDB deduction of Rs. 40,000 or the actual amount of expenditure one has paid, whichever is lower.
- One can expect up to Rs. 1 lakh as a tax deduction on the amount paid for medical treatments of specified diseases if they are over 60 years old.
However, to avail of the benefits of such deductions, individuals must meet certain eligibility parameters. Find all these details in the following section.
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Who Is Allowed to Claim Deductions under Section 80DDB?
Taxpayers should meet these specific parameters mentioned below to claim tax deductions under section 80DDB:
- A taxpayer can either be an individual or belong to a HUF and should be an Indian resident.
- 80DDB Deductions can be claimed to treat specified ailments for self or dependent family members, including children, siblings, spouse and parents.
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.
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How and from whom to get a medical certificate to claim deductions
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.
Details to be included in the Certificate of the Disease
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:
Name
Address
Qualification
Registration Number
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.
Diseases Covered under Section 80DDB
Here are the diseases or ailments this particular provision of the Income Tax Act, 1961 covers:
- Neurological diseases where a Neurologist possessing a D.M. degree certifies that the patient’s disability is above 40%
These diseases are:
- Dystonia Musculorum Deformans
- Chorea
- Dementia
- Ataxia
- Motor Neuron Disease
- Aphasia
- Hemiballismus
- Parkinson’s Disease
- All kinds of malignant cancers that have been certified by an Oncologist.
- Specified hematological diseases, as certified by a medical professional holding a degree in Hematology
And, the disorders might include the following:
- Thalassaemia
- Hemophilia
- Full-blown cases of Acquired Immuno-Deficiency Syndrome or AIDS
- Chronic renal failure as certified by a Nephrologist
List of specialists who can give a certificate under section 80DDB
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.
Documents Required to Claim Deductions under section 80DDB
Apart from the medical certificate provided by the medical professional, you need to submit some additional documents too. For instance:
- A prescription stating that the patient needs to get treatment for the specified disease under Section 80DDB of the Income Tax Act.
- A document that acts as proof of the ongoing treatment for that particular disease from any private/government hospital.
- A medical certificate issued by a specialist at the hospital where the patient is getting treatment from.
Now that you clearly understand all the requirements to claim tax deductions under this provision, find some of its limitations in the next section.
Exclusions under Section 80DDB
Here are some of the limitations of this provision:
- You will not be able to claim deductions for the treatment of any disease that is not specified under section 80DDB.
- In case you fail to submit the necessary document (valid medical certificate), your 80DDB deduction claim will become invalid.
- This provision will not be applicable if you are claiming tax deductions for the treatment of a dependent family member who is already insured and got reimbursement for treatment expenses. Generally, the reimbursement amount gets deducted from the total medical expenditure and does not qualify for deduction under section 80DDB.
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 Finance Act 2015 Amendment
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.
Final Word
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.
FAQs under Section 80DDB deductions
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.
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This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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