New Provision
Section 154, IT Act 2025
Replaces (IT Act 1961)
233 80U
Chapter
Chapter VIII — Deductions in Computing Total Income
Effective From
1 April 2026
Statutory Text — Section 154
(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.
CHAPTER IX REBATES AND RELIEFS A. —Rebates and reliefs
Shahi & Co. — Our Understanding
This section falls under Chapter VIII which provides deductions from gross total income — these reduce your taxable income and directly lower your tax liability.
Practical Note: Unlike exemptions (Chapter III), deductions require active claiming in the ITR. Ensure proper documentation — payment proofs, investment certificates, employer certificates — is maintained for every deduction claimed.
Shahi & Co., Chartered Accountants
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Disclaimer: This is a reproduction of Section 154 of the Income Tax Act, 2025 (No. 30 of 2025) as published in the Official Gazette of India (CG-DL-E-22082025-265620) for informational and reference purposes only. Shahi & Co., Chartered Accountants makes no warranty as to completeness or accuracy. For the official authenticated text refer to
egazette.gov.in or
incometaxindia.gov.in. This does not constitute legal or tax advice.