Deduction under section 80U for a person with disability (as set, 1961 Act, AY 2017-18)

Who may claim

A resident individual holding a certificate from the medical authority that he or she has a disability; the certificate may be issued at any point in the previous year (section 80U(1)). A non-resident, or a Hindu undivided family, cannot claim it.

Amount of the deduction

A fixed deduction, whatever the actual spending on treatment (section 80U(1) and its proviso, as substituted by Act 20 of 2015 with effect from assessment year 2016-17, so in force for assessment year 2017-18):

Certificate

• The individual must attach a copy of the certificate of the medical authority, in the prescribed form, to the return of income under section 139 for the year of the claim (section 80U(2)).
• Where the certificate says the disability is to be reassessed after a period, no deduction is allowed for a year after the year in which the certificate expires, unless a new certificate is obtained and furnished with the return (proviso to section 80U(2)).

Meaning of the terms

• Disability is taken from the definition in the Persons with Disabilities Act, 1995 (its definition clause (i)), and it also covers autism, cerebral palsy and multiple disabilities as the National Trust Act, 1999 defines them (Explanation (a) to section 80U).
• Person with disability is a person so described in the 1995 Act (its definition clause (t)) or a person with disability under the National Trust Act, 1999 (its definition clause (j)) (Explanation (c) to section 80U). The second category has no percentage test of its own in section 80U.
• Person with severe disability is a person with 80% or more of one or more disabilities, or a person with severe disability under the National Trust Act (Explanation (d)).
• Medical authority is the authority under the 1995 Act, or one notified by the Central Government for autism, cerebral palsy and multiple disabilities (Explanation (b)).

The 40% threshold applies to the first category only: it comes from the 1995 Act's own definition, which section 80U adopts. (Persons with Disabilities Act, 1995, section 2(t): a person suffering from not less than 40% of any disability, as certified by a medical authority; section 56(4): 80% or more for a severe disability.)

Section 80U compared with section 80DD

Section 80U is for the disabled individual's own income; section 80DD gives a deduction to a resident individual or Hindu undivided family for the maintenance and medical treatment of a dependant with disability. A minor child with such a disability is also outside the clubbing of section 64(1A).

Example

Mr. Sameer, resident, has a certificate of 60% locomotor disability. His gross total income for 2016-17 is ₹5,20,000. His deduction under section 80U is ₹75,000, whatever he spent on treatment, so his total income is ₹4,45,000. Had the disability been 85%, the deduction would be ₹1,25,000 and the total income ₹3,95,000.