Medical insurance acts as a financial safety net, covering unexpected healthcare expenses and hospitalization costs when you need it most. It helps manage potential financial crises related to medical expenses. Now, most people in India rely on credit options or personal savings when it comes to handling healthcare emergencies.
Thus, the government is offering tax benefits on medical insurance premiums to encourage citizens to secure health-specific insurance coverage. However, as per the Income Tax Act, only eligible policyholders can get tax benefits against medical insurance under Section 80D. Read on to learn more about it!
Section 80D of the Income Tax Act allows members of HUF (Hindu Undivided Family) and individual taxpayers to claim tax deductions. However, the claim for tax deductions can be made only against the health insurance premium, medical expenses for senior citizens and preventive health checkups.
This tax benefit is solely allotted for the mentioned categories. Companies, partnership firms, and trusts are not eligible for medical insurance tax deductions.
The IT Act’s Section 80D allows a deduction of up to ₹25,000 for individuals and HUFs from their taxable income for medical insurance premiums. For senior citizens (60 years and above), the maximum tax benefit amount is ₹50,000 per financial year.
Taxpayers can potentially claim a total deduction of up to ₹1 lakh under Section 80D, combining benefits for themselves, spouses, dependent children, and parents. This provision aims to incentivize the purchase of health insurance by reducing the overall tax burden.
Inclusions of deductions under section 80D are as follows:
Certain types of payments do not qualify for deductions under Section 80D:
Here is a detailed tabular interpretation of the tax deduction amount eligible under Section 80D:
Insured | Claim for Self & Family (in ₹) | Claim for Parents (in ₹) | Preventive Health checkup (in ₹) | Maximum Tax Deduction (in ₹) |
Individual Policyholders & Families below 60 years | 25,000 | -- | 5,000 | 25,000 |
Individual Policyholder & Family + Parents all below 60 years | 25,000 | 25,000 | 5,000 | 50,000 |
Individual Policyholder & Family below 60 years + Parents above 60 years | 25,000 | 50,000 | 5,000 | 75,000 |
Individual Policyholder & Family + Parents above 60 years | 50,000 | 50,000 | 5,000 | 1,00,000 |
Members of HUF below 60 years | 25,000 | 25,000 | 5,000 | 25,000 |
Members of HUF above 60 years | 50,000 | 50,000 | 5,000 | 50,000 |
Understanding the nuances of Section 80D can help you make informed decisions about medical insurance and tax planning. When considering a health insurance policy, choose Star Health for comprehensive coverage at the most affordable premiums.
By doing so, you save on both premiums and taxes, resulting in more savings, which you can utilize for other aspects of your life.
Yes, medical expenditure for senior citizen parents could be availed off. For senior citizens who are aged above 60 years, the tax benefit amount is a maximum of ₹50,000 each financial year. Taxpayers could make a medical claim of a total deduction of a maximum of ₹1 lakh under Section 80D, combining advantages for themselves, spouses, dependent children, and parents.
While people search for government mediclaim for senior citizens, they also want to know about the affordable plans that apply medical expenses deduction for senior citizens. Many non-government health insurance for senior citizens are available, which are those offering health care medical advantages. Senior citizen health insurance is an old age health insurance particularly created for individuals aged 60 and above.
Under Section 80D, a tax deduction of a maximum of ₹50,000 each financial year on health insurance premiums for senior citizens is permitted. That is, the health insurance yearly premiums deduction for senior citizens is available.
Premiums paid for the cancer insurance plans have a deduction as per Section 80D. The concept of medical expenses deduction in income tax is considered an advantage in cancer protection plans. While choosing the best cancer insurance plan in India, ask your insurance provider about the tax deductions.
The preventive health checkup in income tax acts have deductions under Section 80D. One can claim a deduction for the preventive health checkup bill paid. Preventive health checkup lists include cancer screening, blood tests, etc.
Secure your health and finances with Star Health today!
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