Section 80U - Tax Exemption for Disable Person | With Automatic Income Tax Preparation Software in Excel for the Govt and Non-Govt Employees for the F.Y.2021-22

 

Section 80U - Tax Exemption for Disable Person | There are certain sections of the Income Tax Act of India that offer tax advantages to individuals if they or any member of their family has a disability.

 

Section 80U provides tax benefits if a person is a victim of a disability. This article focuses on discussing the tax benefits available in section 80U.

 

Who can apply for an exemption under section 80U?

A taxpayer who has been certified that he is a disabled person by any medical authorities can claim tax benefits under section 80U. For the purposes of this section, a disabled person is defined as having at least 40 percent of the disability certified by the health authorities.

 

For the purposes of this section, a disability is defined as any of the following:

blindness

low vision

leprosy treatment

Hearing problem

motor disability

mental delay

mental disease 

This section provides a definition of severe disability which refers to a condition in which the disability is 80% or more. Severe disabilities include multiple disabilities, autism, and cerebral palsy. 

Amount of exemption under 80U

The 75,000 exemption is allowed for people with disabilities and Rs. 1.25,000 exemption for people with severe disabilities. 

Obligation to Apply for Exemption Under Section 80U

Form 10-IA does not require any documents other than a certificate of disability attested by a recognized medical authority. There is no need to invoice for subsequent treatment or other similar expenses. 

To submit an application under this section, you must submit a medical certificate certifying your disability along with your section 139 income tax return for the relevant A.Y.

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4) Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E from the F.Y.2000-01 to F.Y.2021-22 (Update Version)

 

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Once the Invalidity Assessment Certificate has expired, this deduction can be requested in the year the certificate expires. However, to apply for the benefit under 80U, a new certificate will be required from next year onwards.

 

The certificate can be obtained from medical authorities, either a neurologist with a Doctor of Medicine (MD) in neurology (in children, equivalent to a pediatric neurologist) or a civil surgeon

 

Note: If the invalidity is temporary and requires re-evaluation after a certain period, the validity of the certificate starts from the year of assessment with the year in which it was issued and the related year of assessment ends with the year of expiry. of the Certificate.

 

Difference between section 80U and section 80DD

Section 80DD provides for the tax deduction for disabled people and the relatives of taxpayers, while section 80U provides for the tax deduction for the disabled person himself.

 

Section 80DD is applicable if a taxpayer pays a certain amount as an insurance premium for the assistance of his or her dependent disabled person. In section 80DD, the deduction limit is the same as in section 80U. Here, dependent refers to siblings, parents, spouses, children, or members of a Hindu family.

Frequent questions

 

What certificate do I need to provide to apply for a deduction under section 80U?

The person must provide a copy of a medical certificate under section 80U along with the tax return.

 

What is the amount of the deduction under section 80U?

The amount of the exemption available for a disabled person is Rs 75,000. In case of 80% disability, the exemption is Rs 1.25.000.

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Download Auto-fill Income Tax Preparation Software All in One in Excel for the Govt and Private Employees for the F.Y.2021-22 with Section 80C - Deduction on Investment

 

Download Auto-fill Income Tax Preparation Software All in One in Excel for the Govt and Private Employees .Section 80C is the most preferred category of all income tax payers because it allows the taxpayer to reduce tax liability by making tax saving investments and collecting eligible expenses. This allows a maximum of Rs 1,50,000 per year to be deducted from the total income.

 

This section can be beneficial for an individual and HUF. Companies, LLPs, firms and partnerships are not eligible to take advantage of this discount.

 

Section 80C also includes subsections like 80CCC, 80CCD (1), 80CCD (1B), 80CCD (2).

 

All these sections together allow deduction of Rs.1, 50,000, but section 80CCD (1B) allows additional deduction of Rs.50,000.

 Section 80TTA - Interest on Savings Account:

The benefits of this department are available only to one person and HUF, they can claim deduction of Rs.10,000 against interest income from the savings bank account, the account is in the bank, co-operative society or post office. This section does not apply to interest earned from a fixed deposit account or a recurring deposit account.

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Section 80GG - House for Rent:

 Deductions under this section are only available to the taxpayer if the house rent allowance is not available. The taxpayer or the taxpayer's spouse or minor child shall not own any residential premises in the place of employment. The taxpayer shall not own any self-acquired property elsewhere. The taxpayer will be staying at the renter's residence. This discount applies to everyone.

 The amount of cut may be the lowest of the following:

1. Consistent minus 10% of total income is rented;

2. 5,000 per month;

3. Consistent 25% of total income.

 

Section 80E - Interest on educational loans:

A deduction can be claimed under this section on the interest on loans taken for higher education. This loan can be taken for the taxpayer himself or for his wife or child or for the person on whose behalf the taxpayer is the guardian.

 

The deduction under this section can be claimed up to 8 years or up to the date of payment of interest, whichever is earlier.

 Section 80EE - Home Loan Interest:

A discount is available under this section in FY 2017-2018 only if the loan is taken in FY 2016-2017. The deduction is only available to homeowners who have only one home property on the date of the loan. The value of the property should be less than Rs 50 lakh and the loan amount should be less than Rs 35 lakh. They can claim a discount of up to Rs 50,000 per year under this category.

Section 80D - Medical Insurance:

 An individual and HUF can claim deduction under this section, if the medical insurance is taken for oneself, spouse and dependent children, you can claim a discount of Rs 25,000. An additional deduction of Rs 25,000 is available for insurance taken for parents below 60 years of age, and if the age is over 60, the deduction amount can be Rs 50,000, an amount increased from Rs 30,000 in the 2018 budget.

 Section 80U - Physical Disability:

A resident with a physical disability or mental disability is entitled to a rebate of Rs 75,000 under this section. A discount of Rs 1,25,000 can be claimed in case of severe disability.

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Feature of this Excel Utility:-

 

1) This Excel utility prepares and calculates your income tax as per the New Section 115 BAC (New and Old Tax Regime)

 

2) This Excel Utility has an option where you can choose your option as New or Old Tax Regime

 

3) This Excel Utility has a unique Salary Structure for Government and Non-Government Employee’s Salary Structure.

 

4) Automated Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E from the F.Y.2000-01 to F.Y.2021-22 (Update Version)

 

5) Automated Income Tax Revised Form 16 Part A&B for the F.Y.2021-22

 

6) Automated Income Tax Revised Form 16 Part B for the F.Y.2021-22

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Disabled can claim tax saving deductions up to Rs 1.25 lakh under sections 80DD, 80U With Automated Income Tax Revised Form 16 Part A&B and Part B with Form 12 BA for F.Y.2019-20

The Income Tax Act allows deductions from your gross total income, before the levy of tax, if medical expenditure has been incurred on the treatment of a differently-abledperson. Sections 80DD and 80U of the Income Tax Act deals with the medical expenditure incurred for this purpose.

Though the working of these two deductions is the same, according to income tax rules, these cannot be claimed simultaneously. Section 80DD and Section 80U of the Income Tax Act allows a deduction for the medical expenses incurred for differently-abled persons. In other words, the amount of deduction is the same for both the sections. However, Section 80DD can be claimed by the person who has incurred expenses for the dependent differently-abled person. On the other hand, 80U can be claimed by the individual if he/she, himself/herself, is differently-abled. If the individual is claiming deduction under section 80U, then no other person can claim deduction under section 80DD for the aforesaid person.

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However, here is everything you need to know about claiming deductions under both sections 80DD and 80U.

Who can claim the deduction?
As mentioned above, deduction under section 80DD can be claimed by a resident individual who has incurred expenditure on the training, rehabilitation, medical treatment of a differently-abled or disabled dependent person.

For instance, the income tax law defines a dependent person like spouse, children, parents, brother and sisters of the individual who are fully dependent on the individual for the support and maintenance.

Above all, the deduction can also be claimed if payment or deposit has been made by the individual under any scheme of Life Insurance Corporation (LIC), or any other the insurer or any other specified scheme or deposit for the maintenance of the dependent. The scheme should provide the annuity or lump-sum benefit in the event of the death of the individual for the maintenance of the dependent person suffering from disability

Conditions for claiming deduction
In addition, the deduction under either section 80DD or 80U can be claimed only if the individual himself or dependent is suffering from disability, autism, cerebral palsy or multiple disabilities.

The percentage of disability should not be less than 40 per cent in order to be eligible to claim deduction under these sections. In case you are claiming the deduction allowed for severe disability, then the disability level should be a minimum 80 per cent.

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To avoid the rejection of the claim for deduction by the income tax department, one must also satisfy the definition of disability, autism, cerebral palsy or multiple disabilities as per the act governing the same.

Disability is defined as per the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1955. As per Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995, disability is defined as someone who is suffering from blindness, low vision, leprosy-cured, hearing impairment, locomotor disability, mental retardation, mental illness, autism, cerebral palsy and multiple disabilities. A person with a disability. 

Similarly, autism, cerebral palsy and multiple disabilities take their meaning from the National Trust for the welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999. Multiple disabilities can be defined as the person suffering from a combination of two or more disabilities as defined in Person with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995.

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Amount of deduction depends on disability, not expenses & age
After that, the amount of deduction that can be claimed depends on the percentage of disability. If the individual or dependent has 40 per cent or more disability but less than 80 per cent, then the deduction of Rs75,000 can be claimed in a financial year.

In case of severe disability, i.e., if the percentage of disability exceeds 80 per cent, then the deduction of Rs 1.25 lakh is allowed.

The amount of deduction depends on the percentage of disability. The deduction claimed is fixed irrespective of the actual expenses. Therefore, even if the actual expenses are less than Rs 75,000 or Rs 1.25 lakh as applicable, you can still claim the mentioned amount.

Documents required
To claim this deduction, either under Section 80DD or Section 80U, one is required to provide a certificate of disability. As per the income tax laws to claim the deduction, one is required to obtain a certificate in the prescribed manner as mentioned in Form 10-IA. The certificate must be obtained from the prescribed medical authority.

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In conclusion, the medical authority is required to issue the disability certificate shall be a neurologist having a degree of Doctor of Medicine in Neurology (in case of children, a Pediatric Neurologist having an equivalent degree) or a civil surgeon or chief medical officer in a Government hospital.

Source From  Economics Times

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