What tax advantages can be found for fogeys of autistic kids? | Mint

My son is autistic and his UDID card mentions 25% incapacity. What tax advantages am I eligible for? Is it true that the clubbing provision doesn’t apply to particular kids? Also, how can I arrange a belief for his future?

– Name withheld on request.

Since your son is identified with autism, you might be entitled to say a set deduction of ₹75,000 per yr beneath Section 80DD of the Income Tax Act. This deduction covers bills associated to medical remedy (together with nursing), coaching, and rehabilitation of a dependent with a incapacity.

Importantly, within the case of autism, the 40% incapacity threshold doesn’t apply to say this deduction. You will, nevertheless, want a legitimate medical certificates issued by a neurologist or a civil surgeon/chief medical officer at a authorities hospital, which should be filed utilizing Form 10IA earlier than submitting your revenue tax return.

If your son’s situation is assessed as a extreme incapacity (greater than 80%), the deduction will increase to ₹125,000 per yr.

As to your second question, sure, you might be appropriate—the clubbing provisions beneath the Income Tax Act don’t apply within the case of a minor youngster with a incapacity as outlined beneath Section 80U. Since autism is included on this definition, any revenue your son earns won’t be clubbed together with your revenue. This supplies a major monetary planning benefit.

Regarding property planning, you may think about making a particular wants belief to your son’s future. This might be accomplished both:

During your lifetime (an inter vivos belief), or

Through your will (a testamentary belief, which takes impact after your passing).

The belief deed ought to clearly define the aim of the belief, the appointed trustee(s), and the way the funds are to be managed and utilised to your son’s care. As lengthy because the belief is ready up particularly for the advantage of a dependent with a incapacity, any property or funds acquired by the belief will probably be exempt from tax.

The most important a part of this course of is figuring out a reliable and succesful trustee who can guarantee your youngster’s well-being and monetary safety over the long run.

Mahesh Nayak, chartered accountant, CNK & Associates. 

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