By Arnav Pandya
There is an additional tax benefit that is available to an individual if there are medical expenses incurred on specific diseases and it would be beneficial to look at the exact details. This will give you an idea as to which are the situations under which a benefit can be claimed and if this knowledge is available beforehand then there can be some planning beforehand otherwise this could be forgotten. Here are several details related to the transaction that has to be under your focus.
The first thing is that this additional benefit which is over and above the insurance premium paid for medical insurance is available for a resident individual. This means that a non resident individual would not be able to claim the benefit. The benefit is available under Section 80DDB if the amount has actually been incurred so this is a crucial aspect in the whole calculation. The amount should have been incurred for a specified disease or ailment and it should have been incurred for the treatment of the tax payer himself or wholly mainly dependent husband/wife, children, parents, brothers and sisters of the individual. This list is very clear and if the amount is spent for the treatment of someone who is outside the list then the benefit is going to be denied. The point of being wholly or mainly dependent is also significant because those who do not fall within this definition would remain out of the coverage.
There is a long list of specified diseases that has been mentioned and these have to be looked at closely. The first sub category consists of neurological diseases where the disability level is certified at 40 per cent and higher. This includes dementia, motor neuron disease, ataxia, chorea, aphasia, Parkinsons disease among others. Then there are malignant cancers along with full blown AIDS, chronic renal failure, hematological disorders which includes haemophilia and thalassaemia. This is a long list of diseases but they have been clearly specified so it has to be seen whether any disease that is being treated is a part of this list or not.
Amount of deduction:
The amount that will be allowed as a deduction would be the actual amount that is spent on medical treatment or Rs 40,000 whichever is less. If the person is a senior citizen then the amount would be Rs 60,000 or actual whichever is less. Take for example a situation where the expense incurred by a person for treatment of one of the specified diseases is just Rs 25,000. In this case the amount of deduction would be Rs 25,000 however if the person incurred Rs 1 lakh but is not a senior citizen then the deduction amount would be Rs 40,000. Another important thing is that if there is an amount received from an insurance company or reimbursed by an employer then the deduction would be reduced to that extent.
An additional part of the process is that the individual would be required to obtain a certificate from a neurologist, an oncologist, a urologist or some other specialist as required who is working in a government hospital. This will certify that the person has been treated for the specified disease and other details which will help in claiming the amount. A small detail is that the certification has to be obtained from a person working in a government hospital. It does not say that a person has to be employed in a government hospital on a regular basis so in several cases there could be a person who is working there and hence would be able to give the requisite certificate. There is a specific format that has been prescribed for the certificate and this would thus need to be in that specific format so this is something that has to be taken care of.
The author can be contacted at firstname.lastname@example.org