80DD & 80U Deductions: AY 2025-26 Introduces Mandatory Acknowledgement Number

For the Assessment Year (AY) 2025-26 (Financial Year FY 2024-25), the Income Tax Department has implemented an important update for individuals claiming deductions under Section 80DD and Section 80U. Merely possessing a disability certificate is no longer sufficient; you must now include its acknowledgement number in your Income Tax Return (ITR). This modification is essential for verification and a seamless filing experience.

Quick Overview: Sections 80DD & 80U

These provisions provide fixed deductions for individuals and Hindu Undivided Families (80DD for disability of a dependent) and individuals (80U for personal disability) under the Old Tax Regime.

• Deduction Limits: ₹75,000 for disability (between 40-79%) and ₹1,25,000 for severe disability (80% or more).

The New Regulation: Acknowledgement Number is Essential

ITR forms for AY 2025-26 (such as ITR-2, ITR-3) now specifically request the acknowledgement number of your disability certificate. This unique identifier is issued by the medical authority when you obtain your certificate.

Significance of This Change

This new stipulation aims to:

• Enhance Verification: Enables the Income Tax Department to easily validate claims against medical authority records.
• Prevent Fraudulent Claims: Introduces an extra layer of protection to discourage false deductions.
• Increase Data Accuracy: Contributes to more accurate data for tax analysis.
• Possibly Accelerate Processing: Improved verification could expedite the processing of returns.

Your Checklist for AY 2025-26

If you intend to claim deductions under 80DD or 80U, ensure you:

• Have a Valid Disability Certificate: Secure one from an authorized medical authority (e.g., Civil Surgeon). Ensure it details the type and percentage of disability.
• Obtain the Acknowledgement Number: Acquire this unique number when your certificate is issued. Keep it in a safe place!
• Input it in Your ITR: You’ll need to enter this number in the appropriate section of your ITR form (e.g., Schedule VI-A).
• Verify Certificate Validity: If your certificate has lapsed, obtain a new one that includes its acknowledgement number before submitting your return.

Essential Documentation Beyond the Number

Though the acknowledgement number is new, remember to prepare these necessary documents:

• Medical Certificate (Form 10-IA if necessary): The primary proof of disability.
• Self-Declaration Certificate (for 80DD): Declaring incurred expenses (retain actual bills for your records).
• Insurance Premium Receipts (for 80DD): If claiming deductions for approved insurance plans.
• UDID Number (if applicable): While not universally mandatory, it's becoming increasingly relevant.

In Summary

The requirement for the disability certificate acknowledgement number for AY 2025-26 signifies the Income Tax Department's commitment to enhanced transparency and accurate verification. By comprehending and adhering to this new requirement, you can ensure a smoother filing experience and continue to take advantage of these important tax deductions. Always consult official sources or seek advice from a tax professional for the most current information.

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