Medical emergency is something which can occur anytime, anywhere and to anyone without giving a warning sign. So, experts suggest taking health insurance is the best option to secure yourself from any future emergencies. Taking health insurance also provides tax benefits as one can get tax deductions while under section 80D.
Under Section 80D, taxpayers can get tax exemptions for health insurance premium paid for self, family, parents, and medical expenses for preventive health checkups.
All you need to know about tax deduction benefits under 80D
• Under Section 80D one can claim tax for medical insurance and medical expenditure
• The limit of tax amount which can be claimed depend upon the members and their age and you can claim minimum Rs.25,000 to maximum Rs. 1 Lakh
• Individual family and HUF can claim tax under Section 80D
• Deductions for medical premiums paid for self, family, and parents dependent on you can be claimed
• Also claim deductions on expenses incurred on preventive health check-ups for self, family, or parents. This will be within the overall limit though
• If you are 80 plus and you do not have any insurance policy, then per annum you can claim and get tax deduction of Rs.30,000
• An individual can claim tax for the premium paid for self and family up to Rs.25,000, on premium paid for parents upto Rs.25,000 (max Rs. 30,000, which includes additional 5000 rupees on medical health check-ups of parents) and Premium paid for senior citizen (Above 60 years) of upto Rs.50,000
• For HUF under Section 80D one can claim tax for health insurance premium paid for any member up to Rs.25,000 or premium paid for senior citizen member upto Rs.50,000
According to Adhil Shetty, CEO, Bankbazaar- “Say you are a family of three with an insurance premium of Rs.22,000 that covers all three of you. Assume you got a health check-up done for yourself and paid Rs 5,000. In this case, can claim a maximum deduction of Rs 25,000 under Section 80D of the Income Tax Act--Rs.22,000 towards insurance premium paid, and Rs.3,000 towards the health check-up. The deduction towards preventive health check-up will be restricted to Rs.3,000 as the overall deduction cannot exceed Rs.25,000 in this case.”
• Under Section 80D, one can also claim for additional preventive health checkups with the maximum limit on such medical expenses covered at Rs.5,000. This limit can be covered which is applied under 80D and not over and above the limit of any individuals medical claim limits
• Remember, you cannot claim for tax benefits on the premium paid for health insurance availed by your relatives or siblings
• Note, you cannot avail tax benefits on health insurance premium paid in cash
• One can avail tax benefits for more than one health insurance policy under Section 80D, but one must make sure that all the eligibility conditions are met, and premiums are paid for all the insurance policies on time
• Always ask your tax expert/financial advisor before opting for any tax benefit insurance plans. Go for such insurance plans which fits your needs and objectives.