Hearing impaired? Rebate up to Rs 1.25 lakh admissible

S C Vasudeva

I am hard of hearing for many years. Recently, I read in your column that some income tax rebate is admissible on this account under Section 80U. Therefore, I applied for a disability certificate which has now been issued to me by the state government on 23.5.15. Will this certificate be applicable to my income for the Assessment Year 2015-16 (FY 2014-15) for getting the tax rebate? Please clarify.

(ii) The health department authorities found that I was suffering from 80 db loss in one year and 90 db loss in another ear. In percentage, they assessed my loss as 75%. What rebate shall be applicable to me?

(iii) Has the government increased the rebate limit for the next Assessment Year? — Maheep Nijhawan

The validity of the certificate normally should be prospective and therefore certificate dated 23.5.2015 should be valid for the financial year 2015-16. However, in case the certificate clarifies that the disability existed during the financial year 2014-15 to the same extent and the certificate is valid for financial year 2014-15, it should be possible to claim deduction under Section 80U of the Act for the said financial year. You are entitled to claim a deduction of Rs 75,000 from your total income for the AY 2016-17 relevant to the FY 2015-16. In the preceding year, admissible deduction will be Rs 50,000 as your case is not covered within the category of severe disability. The deduction for AY 2016-17 has been increased from Rs 50,000 to Rs 75,000 in case of a person suffering from disability and Rs 1,25,000 to a person suffering from a severe disability.

I am in receipt of a conveyance allowance of Rs 2,000 per month. My employer has added the said amount to my total salary income and deducted tax thereon. Is the action of my employer correct for deducting tax on such conveyance allowance? —Rajender Kumar

Conveyance allowance is exempt up to Rs 1,600 per month under Section 10(14) of the Act read with Rule 2BB of the Income-tax Rules 1962. The balance amount of Rs 400 would be taxable in your hands.

One of my clients is a doctor and shows his income in ITR as professional income. Now, he and his wife are starting a business. Can he show this business profit as HUF income?

A. Hindu joint family consists of all persons lineally descended from a common ancestor and includes their wives and daughters. As against this, a Hindu co-parcenary (HUF for tax purposes) is a much narrower body than a joint family. It includes only those persons who acquire by birth an interest in the joint or co-parcenary property, these being the sons, daughters, grandsons, great grandsons of the holder of the property for the time being. The query does not indicate whether there is an existing Hindu Undivided Family i.e. a Hindu co-parcenary which would carry on the business. In case there is a joint family in existence, it may be possible to establish that there is an existing HUF. In such a case, it may be possible to carry on the business in the name of HUF by a doctor who is also carrying on his profession subject, however, to any requirement by code of ethics applicable to doctors.