Introduction
Medical emergencies, educational expenses and caring for a differently-abled dependent can be costly. Thankfully, the Income Tax Act provides multiple deductions under Chapter VI-A to ease this burden. In this article you’ll learn:
- How to claim Section 80D for health insurance and preventive check-ups
- When Section 80DD and 80U cover disability costs
- How to use Section 80DDB for specified diseases
- Why Section 80E makes education loans tax-friendly
Whether you’re a salaried professional, self-employed individual, or HUF, these deductions can cut your tax liability––let’s dive in.
1. Section 80D: Health Insurance & Medical Expenses
1.1 What Qualifies
- Premiums paid for insurance of self, spouse, dependent children.
- Preventive health check-up expenses (up to ₹5,000 within the overall limit).
- Parents’ insurance/medical expenses.
1.2 Deduction Limits (FY 2024-25)
| Recipient | Maximum Deduction | Notes |
|---|---|---|
| Self + family | ₹25,000* | ₹50,000 if any insured member ≥60 years |
| Preventive check-ups | Up to ₹5,000 | Within above limits |
| Parents | ₹25,000* | ₹50,000 if parents ≥60 years |
| No insurance for parent | ₹50,000 | Only actual treatment costs, if ≥60 yrs |
* If both you and your parents are senior citizens (≥60), you can claim ₹50,000 + ₹50,000 = ₹1,00,000.
Example:
Mr. Verma (age 45) insures his family (premium ₹20,000) and pays ₹4,000 for check-ups. His parents (both 62) have premiums of ₹30,000.
- Deduction for self & family: ₹24,000 (₹20k + ₹4k check-ups)
- Deduction for parents: ₹50,000 (capped)
- Total Section 80D benefit = ₹74,000
2. Section 80DD & 80U: Disability Deductions
2.1 Section 80DD (Dependent Disability)
- Who it covers: Medical treatment, training and rehabilitation of a dependent (spouse, child, parent, sibling).
- Limits:
- ₹75,000 for ≥40% disability
- ₹1,25,000 for ≥80% severe disability
- Requirement: Certificate from a recognized medical authority.
2.2 Section 80U (Self-Disability)
- Who it covers: You, the taxpayer, if certified disabled.
Limits:
- ₹75,000 for ≥40% disability
- ₹1,25,000 for ≥80%
- No dependence: Certificate requirement only—no need to show actual expenses.
Case Study:
Ms. Rao (65% permanent disability) has monthly therapy and equipment costs of ₹1,00,000/year. Under 80DD she claims ₹75,000. Under 80U she could claim ₹75,000 for herself, but cannot double-dip—choose the higher benefit applicable.
3. Section 80DDB: Treatment of Specified Diseases
3.1 Eligible Ailments
Includes Alzheimer’s, cancer, chronic renal failure, multiple sclerosis, Parkinson’s, hemophilia, heart disease, AIDS, and others as listed in the Second Schedule.
3.2 Deduction Limits
| Assessee | Maximum Deduction | Conditions |
|---|---|---|
| Resident <60 years | ₹40,000 | With prescription from specialist |
| Resident ≥60 years | ₹1,00,000 | “Senior citizen” category |
- No limit on actual bills, but cap applies.
- HUFs and individuals can both claim if they incur the costs.
Pro Tip: Keep invoices, doctor’s prescription, and hospital receipts. The prescription must specify disease & treatment cost.
4. Section 80E: Education Loan Interest
4.1 Scope
- Interest paid on loan taken for higher education of self, spouse, children, or student for whom you are a legal guardian.
- No cap on deduction––entire interest portion is deductible.
4.2 Eligible Courses & Lenders
- Courses: Graduate, postgraduate, professional courses in India or abroad.
- Lenders: Banks, financial institutions, approved charitable institutions.
4.3 Tenure of Claim
- Up to 8 years or until interest is paid, whichever is earlier.
Case Study:
Mr. Singh took a ₹5 lakh education loan at 10% interest. First-year interest = ₹50,000. He claims the full ₹50,000 under Section 80E.
Conclusion & Action Plan
- Review your health cover (Section 80D): Maximize family and parents’ deductions.
- Assess disability certificates (80DD/80U) if applicable—choose the higher benefit.
- Track specified disease expenses (80DDB) with specialist prescriptions.
- Plan education loans early and claim interest (80E) consistently for up to 8 years.
🔗 Next in Series
Stay tuned for Article 4: Home & EV Loan Deductions (Sections 80EE, 80EEA & 80EEB) where we’ll help you reduce your tax using property and electric-vehicle loans.
Call to Action:
- Comment below: Which deduction did you find most helpful?
- Download our Health & Education Deduction Checklist (PDF) to keep your proofs organized.
This post is part of the “Mastering Section 80 Deductions for FY 2024-25” series by Commerce Tutors.