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Falling ill can be a stressful experience, and the financial burden of medical treatment can add to the worry. Thankfully, the Indian government offers some relief through the Income Tax Act.

This blog post dives into a specific provision—Section 80DDB—that provides a tax deduction for medical expenses incurred for specified diseases under the old tax regime.

What is Section 80DDB?

Section 80DDB is a benefit for an individual who has incurred medical expenses incurred on specified diseases in respect of themselves or their dependents, i.e., spouse, children, parents, brothers and sisters of the individual, if any of them are wholly or mainly dependent on him.

Who Can Claim the Benefit Under Section 80DDB?

• Individuals: Indian-resident taxpayers can claim the deduction for medical expenses incurred for themselves or their dependents.
• Hindu Undivided Families (HUFs): HUFs can also claim the deduction for medical expenses of any member of the family.

Dependents Eligible for Section 80DDB Deduction:

• Spouse
• Children (including adopted children)
• Parents
• Brothers and sisters

Important to Note: The dependent must be wholly or mainly dependent on the taxpayer for financial support.

Diseases Covered Under Section 80DDB:

The diseases have been specified in rule 11DD, which includes

• Neurological Diseases where the disabilities level has been certified to be of 40% or higher,—
• Dementia
• Dystonia Musculorum Deformans
• Motor Neuron Disease
• Ataxia
• Chorea
• Hemiballismus
• Aphasia
• Parkinsons disease
• Malignant Cancers
• Full-blown immunodeficiency Syndrome (AIDS)
• Chronic Renal failure
• Hematological disorders :
• Hemophilia
• Thalassaemia

Understanding the Deduction Limit:

The maximum deduction you can claim under Section 80DDB depends on your age:

Documents Required for Claiming the Deduction:

• Proof of medical expenditure (bills, receipts)
• Prescription for the treatment from a qualified specialist (neurologist, oncologist, etc.) as specified by the Income Tax Department

Key Points to Remember:

• Any amount received from health insurance or reimbursed by an employer for such medical treatment shall be reduced from the deduction.
• The deduction is available only for the year in which the medical expenses were incurred.

Example:

An individual incurs ₹1, 25,000 for the medical treatment of his father (who is a senior citizen and fully dependent on him) in respect of a specified disease. There is no health insurance coverage.

In this case, the deduction allowable under Section 80DDB shall be ₹1,00,000/-.

Conclusion

Section 80DDB offers a helping hand during a challenging time. By claiming this deduction, you can significantly reduce your tax burden and free up resources to focus on what truly matters.

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(Disclaimer: The information provided is based on the provision that exists on the date of publication, is for educational purposes, and should not be construed as tax advice. Tax laws and regulations are subject to change, and individual situations may vary. Consult with a tax advisor to ensure you are claiming deductions in accordance with the provisions of the Act.)