Every family incurs heavy medical expenses at some point.
As a support for this financially draining experience, the government offers
tax benefits on health insurance as well as on treatment-related expenditures.
To make deductions more easy and streamlined, the government has recently
issued a notification simplifying the tax benefit on serious ailment expenses.
Here is all you may need to know about claiming tax benefits on expenses due to
serious ailments and the new process to do so. The tax deductions on treatments
and insurance premiums Sections 80D, 80DD, 80U, and 80DDB of the Income Tax
Act offer rebates on health insurance premiums and expenses incurred during
treatments for serious ailments and disabilities. Under Section 80D: All
citizens below the age of 60 years can obtain a maximum tax rebate of Rs.
25,000 on the premiums paid for health insurance. If you are above 60 years,
you are eligible for deductions up to Rs. 30,000. If you are paying health
insurance for your parents, you can obtain a further deduction of Rs. 30,000 if
your parents are above 60 years and Rs. 25,000 if your parents are below 60
years.
Under Section 80DD and 80U: Any
differently abled person with 40% or more disability incurring medical expenses
for treating themselves can claim tax rebates of up to Rs. 50,000 under Section
80U depending upon the severity. This amount goes up to Rs. 1,00,000 in case of
persons with more than 80% disability. These limits have been further raised to
Rs. 75,000 and Rs. 1.25 lakh respectively from FY 2015-16 onwards. Anyone
financing the treatment of differently abled dependents can also avail the same
deductions under Section 80DD if the dependents have not claimed the deductions
themselves. Under Section 80DDB: You can avail deductions on medical treatment
of specified ailments under Section 80DDB. The limit here is up to Rs. 40,000
for assessees below 60 years of age, and Rs. 60,000 for assessees above 60
years. For seniors above 80 years, the maximum limit is up to Rs. 80,000. This
can be availed for treating dependents as well. The diseases specified under
this section include neurological diseases with 40% or more disability,
Parkinson’s disease, malignant cancers, AIDS, chronic renal failure,
Hemophilia, and Thalassemia. New notification that eases claims Until recently,
one needed a certificate from a doctor working in a government hospital to
avail the deductions under these. Many people ended up not availing these
deductions due to the difficulties in obtaining a certificate from a doctor in
a government hospital. The Central Board of Direct Taxes recently issued a
notification amending the Rule 11DD of the Income Tax Act, which deals with tax
deductions in connection with ailments under Section 80DDB. As per the new
notification, you no longer need the certificate issued by a doctor working in
a government hospital to claim deductions. A certificate from any specialist
doctor will suffice when you are seeking claim for expenses incurred while
treating a serious disease. What the new notification means to the taxpayer
With the new provision in place, the quantum of tax deduction remains
untouched, but there is no longer any need to get a certificate from a doctor
working in a government hospital. Under usual circumstances, it is not easy to obtain
a certificate from a specialized doctor on duty in a government hospital.
Moreover, many government hospitals do not have certain specialists, making it
even more difficult to get a certificate. With the new notification, you can
attach a certificate from any specialist working either in a government or in a
private hospital, and claim your tax deduction. Moreover, it is no longer
mandatory to file the certification from a doctor using Form 10L.
A prescription from a specialist would now suffice to claim
tax deduction against serious ailments. Specifying the name and age of the
patient in the certificate are still mandatory, but just a prescription is
sufficient to file a claim. Things to know before claiming deduction under
section and 80D and 80DDB If you receive reimbursement for the treatment from
your insurance company or employer, you are not eligible to stake a claim for
deductions under Section 80DDB. However, if you receive only partial
reimbursement from your employer or insurance company, you can stake claim to
avail deduction for the remaining amount. With the new amendment, the Central
government has taken another step in clearing roadblocks in tax deductions,
especially in health care.
