Deduction in respect of maintenance including medical treatment of a handicapped dependent relative - (New) Section 127 / (old) Section 80DD

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..... 2. Nature of Deduction The deduction is allowed: • from the Gross Total Income (GTI); • up to a fixed amount of Rs.75,000 / Rs.1,25,000; • irrespective of the actual expenditure exceeding this amount. The deduction is a fixed statutory deduction and is not linked proportionately to actual expenses once the qualifying conditions are satisfied. 3. Two Alternative Ways to Claim Deduction (a) Actual Expenditure The assessee may claim deduction if expenditure is incurred on: • medical treatment; • nursing; • training; or • rehabilitation of the dependant with disability. These expenses should be incurred during the relevant tax ye....

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....re Disability [ Section 127(3) ] Where the dependant suffers from severe disability, the deduction increases from Rs.75,000 to Rs.1,25,000. "Person with severe disability" means- • (i) a person with 80% or more of one or more disabilities, as referred to in section 56(4) of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 (1 of 1996); or • (ii) a person with severe disability referred to in section 2(o) of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999); Taxability Where Disabled Dependant Dies Before Subscriber [ Section 127(4) & (5) ] ....

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....cifies that: • disability must be reassessed after a specified period. • In such cases: • deduction cannot be claimed after expiry of the certificate, unless • a fresh certificate is obtained; and • submitted with the return of income. Prescribed Form [ Rule 61(2) ] The assessee shall furnish along with the return of income, a copy of the certificate issued by the relevant medical authority,- • (a) if the person has a disability or severe disability such as autism, cerebral palsy, or multiple disability, in Form No. 30; or • (b) in all other cases, the prescribed form mentioned in notifications No. 16-18/97-NI.1, dated the 1st Jun....

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....iod, the certificate shall be valid for the period starting from the tax year during which the certificate was issued and ending with the tax year during which the validity of such certificate expires. Specified Medical Authority for Certification of Disability [ Rule 61(1) ] • The medical authority responsible for certifying "autism", "cerebral palsy", "multiple disabilities", "person with disability" and "severe disability" referred to in clauses (a), (c), (h), (j) and (o) of section 2, respectively of the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999 (44 of 1999), shall be the following:- • (a) a Neurologist having a degree of Doctor ....

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.... more by such individual or the member of the HUF, and the payment or deposit to such scheme has been discontinued. • (b) the assessee nominates either the dependant, being a person with disability, or any other person or a trust to receive the payment on his behalf, for the benefit of the dependant, being a person with disability. [ Section 80D(2) ] • Dependent means spouse, children, parents, brothers and sisters of the taxpayer. In case of HUF, any member of the HUF can be a disabled dependent.  • "Disability" shall have the meaning assigned to • it in clause (i) of section 2 of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 19....

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....income of that previous year. [ Section 80D(3) ] • Exception  • The provisions of section 80D(3) shall not apply to the amount received by the dependant, being a person with disability, before his death, by way of annuity or lump sum by application of the condition referred to in section 80D(2)(a)(ii). [ Section 80D(3A) ] Other Conditions  • The taxpayer cannot claim this deduction if the dependent has already claimed deduction under Section 80U for himself or herself. • The disabilities which qualify for tax benefits under Section 80DD of the Income Tax Act include blindness, loco motor disability, low vision, mental illness, mental retardation, leprosy-cured, hearing im....