The Indian government provides tax benefits to individuals who have disabilities or take care of disabled family members. Two important sections in the Income Tax Act that help with this are Section 80DD and Section 80U. While both sections provide tax deductions, they apply to different situations.
This blog will explain what these sections mean and the differences between 80DD vs 80U.
Section 80DD of the Income Tax Act: What is it?
Section 80DD helps individuals or Hindu Undivided Families (HUFs) who financially support a disabled family member. The 80DD income tax deduction goes to the caregiver, not the disabled person.
Who can claim?
- Any individual or HUF looking after a dependent with a disability.
Who is considered a dependent?
- For individuals: Spouses, children, parents, brothers, or sisters.
- For HUFs: Any family member.
What expenses are covered?
- Medical treatment, nursing, and rehabilitation of the disabled person.
- Payments for a health insurance policy that ensures future care for the disabled person.
How much deduction can you get?
- ₹75,000 if the disability is between 40% and 80%.
- ₹1,25,000 for severe disabilities (80% or more).
Section 80U of the Income Tax Act: What is it?
Section 80U of the Income Tax Act provides tax relief directly to people who have a disability. Unlike Section 80DD, this deduction is for the disabled person, not their caregiver.
Who can claim?
- Only a resident individual with a certified disability.
What are the requirements?
- A medical certificate is needed as proof of disability.
How much deduction can you get?
- ₹75,000 for disabilities between 40% and 80%.
- ₹1,25,000 for severe disabilities (80% or more).
What disabilities qualify?
Some of the recognised disabilities include:
- Blindness or low vision
- Hearing impairment
- Intellectual disability
- Autism
- Cerebral palsy
- Locomotor disability
Difference between 80DD and 80U
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Feature
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Section 80DD
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Section 80U
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Who can claim?
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Family member taking care of a disabled dependent
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A person with a disability
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Who benefits?
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The dependent with a disability
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The individual who has a disability
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Proof required?
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Medical certificate + proof of expenses or insurance policy
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Only a medical certificate
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Deduction amount
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₹75,000 (40%-80% disability), ₹1,25,000 (80% and above)
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₹75,000 (40%-80% disability), ₹1,25,000 (80% and above)
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Type of expenses covered
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Medical treatment, rehabilitation, critical illness insurance
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No need to show any expenses
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Conclusion
Both Section 80DD and Section 80U provide tax benefits related to disabilities, but they apply to different people.
It is important to understand the difference between 80DD and 80U and have the necessary medical certificates to claim these deductions. These tax benefits always help minimise the financial burden on disabled individuals and their families, encouraging better healthcare and support.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It is not intended as a substitute for professional advice, diagnosis or treatment. Please consult a certified medical and/or nutrition professional for any questions. Relying on any information provided in this blog is solely at your own risk, and ICICI Lombard is not responsible for any effects or consequences resulting from the use of the information shared.