dear all,
one client has got a dependent who is suffering from specified illness under 80ddb. she spent around 8lacs but insurance reimbursed 2.5 lacs.
act says amount received from insurance company has tobe reduced from deduction amount.
What is the amount of deduction under section 80ddb? is 40k fully allowed as 5.5 lacs spent out of pocket
or no deduction as 2.5 lacs from insurance company already exceeds 40k?
In my opinion insurance reimbursement does not impact the maximum allowable deduction amount of Rs. 40000/- because out-of-pocket expense Rs 550000/- which is exceeds Rs 40000/- the full Rs 40000/- is allowed as a deduction u/s 80DDB.
CAclubindia
