Budget 2022: New tax relief for parents of disabled person under Sec 80DD

| Last updated: 02 February 2022

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Quick Summary

The Indian government has introduced new tax relief measures under Section 80DD of the Income Tax Act, specifically for parents or guardians of disabled individuals. This amendment addresses a previous hardship where annuity payments for a disabled dependant could only be made after the guardian's death. Now, deductions under this section can be claimed even if the annuity or lump sum payment is made during the dependant's lifetime, particularly if the guardian is aged 60 or over and has discontinued scheme payments. This change aims to provide financial support to disabled dependants when they need it most.

Condition of releasing of annuity to a disabled person 1. The existing provision of section 80DD, inter alia, provide for a deduction to an individual or HUF, who is a resident in India, in respect of (a) expenditure for the medical treatment (including nursing), training and rehabilitation of a

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FAQ :

Section 80DD provides a deduction to individuals or HUFs for expenses related to the medical treatment, training, and rehabilitation of a dependant with a disability, or for amounts paid towards a scheme for their maintenance.

Previously, the deduction was allowed only if the annuity or lump sum payment was made for the benefit of the disabled dependant upon the death of the individual or HUF member who subscribed to the scheme.

The amendment allows for the deduction under Section 80DD even if the annuity or lump sum payment is made during the lifetime of the disabled dependant, under specific conditions.

Deductions can be claimed if the guardian is aged 60 years or more, has discontinued payments to the scheme, and the payment is made to the dependant during their lifetime.

These amendments will be effective from 1st April 2023, applying to assessment year 2023-24 and subsequent years.