Financial Year is coming to an end. Here is a list of some of the deductions with enhanced limits. Do not miss to avail the benefits of these deductions this year.
Deduction on Medical Premium
Under Section 80D, the deduction limit for the premium of medical insurance of Self, children, spouse or parents has increased.
Here’s the comparison between the earlier deduction limits and the increased rate of FY 2015-16.
| Earlier | FY 2015-16 | |
| Deduction Limit | 15,000 | 25,000 |
| For Senior Citizens | 20,000 | 30,000 |
So you can claim deduction upto Rs. 25,000 for yourself, your spouse and your children’s medical insurance.
If you pay premium on the medical insurance of your parents, you can claim the deduction upto Rs. 30,000.
You can know more about Section 80D here!
Contribution made to New Pension Scheme
Till this year, you could claim a total deduction of upto Rs. 1.5 Lacs under Section 80C, 80CCC and 80CCD of the Income Tax Act.
Know more about Section 80C, 80CCC and 80CCD here.
But now, you can claim additional deduction of Rs. 50,000 as well; under Section 80CCD (1B).
Thus, now you’re eligible to claim the total deduction of 2 Lacs.
Deductions on the Expenses of Medical Treatment
If you or your spouse / children / dependent parents are suffering from specified diseases than any expenses incurred for the treatment of such diseases are allowed as deduction under section 80DDB. Know more about the deduction.
Here are the enhanced limits with effect from 1st April 2015.
| Section 80DDB | Earlier | FY 2015-16 |
| Individual or member of HUF below 60 | 40,000 | 40,000 |
| Individual or member of HUF between 60 and 80 | 60,000 | 60,000 |
| Individual or member of HUF elder than 80 | 60,000 | 80,000 |
Thus, if you have a very senior citizen dependent on you and they endured a medical treatment, you can claim more deduction on the expenses from now on.
Know more about Section 80DDB here!
Deductions for Differently Abled
For the differently abled people, there are deductions under Sections 80DD and 80U.
The only difference between the two is that…
- Section 80DD is availed for a differently abled dependent*, while
- Section 80U is availed for the Individual taxpayers who are disabled.
(*Dependent: A family member wholly or partially dependent on the taxpayer. In case of an Individual, it could be children, parents, spouse or siblings. In case of an HUF, it could be the members of an HUF.)
In both the cases, there was equal amount of Deduction limit, which has increased equally from FY 2015-16.
Here are the deduction limits of Section 80DD and 80U.
| Section 80DD and Section 80U | Earlier | FY 2015-16 |
| Disabled (minimum 40% of the disability) | Rs. 50,000 | Rs. 75,000 |
| Severely Disabled(80% or more of the disability) | Rs. 1,00,000 | Rs. 1,25,000 |
Know more about Section 80DD and 80U
So, if you have incurred any expenses for your dependent who is differently abled (such as treatment, nursing, rehabilitation or premium paid to any government approved scheme for the good of this dependent), you’ll be able to claim Deductions upto 75,000 or 1,25,000; based on the severity of the same.
However, if you’re an individual taxpayer and you are differently abled, you’ll be able to claim deduction u/s 80U even when there are no particular expenses to mention. Just as Section 80DD, the deduction limit will be based on the severity of your disability.
Deduction on Transport Allowance
Even the deduction limit of transport allowance has increased from FY 2015-16, as given below:
| Deduction on Transport Allowance | Earlier | FY 2015-16 |
| Deduction Limit | Rs. 800 / month | Rs. 1600 / month |
| For differently abled Individuals | Rs. 1600 / month | Rs. 3200 / month |
As you can see, your deduction limit is doubled this year by the government. This deduction is available to the salaried individuals. If the employer is providing them them with a transport allowance, they can claim deduction for the same from their taxable salary income.
So make the most of these enhanced limits and save some taxes this year.
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