Chapter VIII - Deductions to be Made in Computing Total Income
Section 154
Section 154: deduction for a person with disability
Section 154 is the Income-tax Act, 2025's version of the deduction long known as "80U" - a flat deduction for a resident individual who is themselves certified as having a disability, as distinct from Section 127 which covers a taxpayer supporting a disabled dependant.
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Need advice on Section 154?
This article is for general information. Refer to the Income-tax Act, 2025 as amended by the Finance Act, 2026 and the Taxation and Other Laws (Amendment) Act, 2026 for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) An individual, being resident in India, who is certified by a medical authority, at any time during the tax year, as a person with disability or person with severe disability, shall be allowed a deduction of ₹ 75000 or ₹ 125000, respectively, while computing his total income.
(2) The deduction under sub-section (1) shall be allowed only if all of the following conditions are fulfilled:— (a) the individual furnishes a copy of the certificate issued by the medical authority; (b) if the certificate specifies that the disability needs reassessment of its extent after a period stipulated in it, the deduction shall not be allowed for any tax year succeeding the tax year in which the certificate expires, unless a new disability certificate is obtained and furnished; and (c) the certificate referred to in clauses (a) and (b) of this sub-section is furnished in the form and manner, as may be prescribed, along with the return of income under section 263 for the tax year in which the deduction is claimed.
(3) For the purposes of this section, “disability”, “medical authority”, “person with disability” or “person with severe disability” shall have the same meanings as provided in section 127.
Introduction
A resident individual with a qualifying medical-authority disability certificate may claim the fixed deduction in Section 154. The amount depends on whether the certified disability is severe, and certificate validity and filing requirements are decisive.
Key takeaways
Own disability deduction
A resident individual certified with a qualifying disability may deduct ₹75,000; the amount is ₹1,25,000 for severe disability.
Certificate validity
The prescribed certificate must be furnished with the return, and a fresh certificate is needed after an assessment period in the earlier certificate expires.
What Section 154 allows
A resident individual certified by a medical authority, at any time during the tax year, as a person with disability or a person with severe disability, can deduct ₹75,000 or ₹1,25,000 respectively - regardless of actual expenditure incurred.
Conditions
- A copy of the medical authority's certificate must be furnished along with the return of income.
- If the certificate specifies that the disability needs reassessment after a stated period, the deduction is not available for any year after the certificate expires, unless a fresh certificate is obtained and filed.
- "Disability," "medical authority," "person with disability" and "person with severe disability" carry the same meanings given to them in Section 127.
Certificate validity controls the claim
Where the certificate calls for reassessment and expires, a later year's deduction needs a newly obtained and furnished certificate. The prescribed certificate must accompany the return for the year claimed.
Step-by-step flow for applying Section 154
- 1
Is the individual resident in India?
- No: No deduction under Section 154.
- Yes: Go to the next step.
- 2
Was the individual certified by a medical authority, at any time during the tax year, as a person with disability or with severe disability (meanings as in Section 127)?
- No: No deduction under Section 154.
- Yes: Go to the next step.
- 3
Which category is certified?
- Person with disability: Deduction of ₹75,000.
- Person with severe disability: Deduction of ₹1,25,000.
- 4
Does the certificate require reassessment after a stated period, and has it expired?
The deduction is not allowed for any tax year after the tax year in which the certificate expires, unless a new certificate is obtained and furnished.
- 5
Furnish the certificate with the return under section 263
In the form and manner prescribed, for the tax year of the claim.
Practical checklist
Do
- Check Indian residence, medical-authority certification and the degree of disability for the relevant tax year.
- Record certificate expiry and obtain renewal when reassessment is required.
Avoid
- Do not claim the severe-disability amount without the corresponding certification.
- Do not keep claiming after an expiring reassessment certificate without renewal.
Illustrative example
Worked example: certificate expiry and renewal
Hypothetical facts (illustration only, not a real taxpayer): Ms. Fernandes, a resident individual, holds a medical authority certificate stating severe disability that calls for reassessment and expires during Tax Year 2. She obtains no new certificate until Tax Year 4, when the new certificate states disability (not severe).
Tax Year 1
Valid certificate of severe disability: deduction ₹1,25,000, with the certificate furnished with the return.
Tax Year 2
The certificate expires in this year. The bar applies only to years succeeding the year of expiry, so ₹1,25,000 is still allowed.
Tax Year 3
No new certificate obtained and furnished: no deduction.
Tax Year 4
New certificate of disability: deduction ₹75,000.
Outcome
- Deductions: ₹1,25,000, ₹1,25,000, nil and ₹75,000 for Tax Years 1 to 4.
- The amount follows the certified category, not actual expenditure.
Glossary
- Severe disability
- A status whose meaning is imported from Section 127 and whose certified amount is ₹1.25 lakh here.
- Medical authority
- The certifying authority defined by the cross-reference to Section 127.
Frequently asked questions
Is this the same as the deduction people call "80U"?
Yes - the same flat disability deduction for the individual themselves, now numbered Section 154 under the Income-tax Act, 2025.
What's the difference between Section 154 and Section 127?
Section 154 is for your own disability. Section 127 is for supporting a dependant (spouse, child, parent, sibling) who has a disability - they cannot both be claimed for the same person's disability.
Do I need to show actual expenses to claim this?
No - it's a fixed deduction (₹75,000 or ₹1,25,000 depending on severity) regardless of what was actually spent, as long as the medical certificate condition is met.
Need help applying this provision to your situation?
Check your Section 154 disability deduction with our tax teamLast updated 9 October 2026