The Central Board of Direct Taxes, under the Finance Ministry, has notified new conditions to claim tax deductions on Covid- 19 treatment expenses. A notification by the board dated August 5, 2022, informed such taxpayers that they have to submit certain documents to their employer and a form submitted to the income tax department to claim exemption from the tax.
Last year, the Union government led by the BJP announced money received by individuals for Covid-19 treatment or on death due to Covid 19 would be exempt from income tax.
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The tax exemption was also notified in Budget 2022. Here is the list of documents to be submitted for tax exemption-
The Covid- 19 positive reports of an individual or his/ her family members.
Necessary documents for medical treatment of the concerned member within six months from the date of being determined as Covid-19 positive.
Documents to support the expenses incurred by the individual for the medical treatment:
Following the notification, a statement of any amount received for the expenses of the Covid -19 treatment for clause (XII) of the first proviso to clause (X) of sub-section (2) of section 56 of the Income-tax Act, 1961 will be verified and furnished in Form No. 1.
Form no. 1 includes details like PAN card, details of diagnosis, expenses incurred, Name, address, and PAN of the concerned person affected with Covid- 19, and financial year when the amount was received.
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In case of death of the person:
The concerned person’s death should be within six months from the date of testing positive. A concerned person is the one who died because of Covid and the taxpayer trying for the exemption should have received the amount from a family member for the diagnosis.
Apart from the above, family members must attach the following detail of the concerned individual-
Covid-19 positive report of the individual, or medical report:
A medical report or death certificate issued by a medical practitioner or a Government civil registration office stating the person died because of Covid.
