Today, changes in global climate and unhealthy lifestyle has made us very vulnerable to various kinds of diseases. Therefore, a good health insurance has become a necessity for every common man. A medical insurance can make you financially prepared for any medical emergency plus it comes with added tax benefits. As a taxpayer, if you have incurred expenses towards medical insurance, preventive health checkup and other medical expenses, then you can claim tax deductions u/s 80D. You can get an income tax deduction tax up to Rs. 60,000 under section 80D.
You can avail the tax deduction under section 80D if you have paid any premium on mediclaim policy under section 80D taken for:
You can also claim tax deduction maximum up to Rs. 5,000 for your expenses on preventive health check-up within the overall limit of Rs. 60,000.
There are four different types of deductions that you can claim u/s 80D. They are:
There is another tax benefit available u/s 80D which can be claimed up to Rs. 5,000 if you have incurred expenses on health check-up of your family, parents and yourself.
If you or any member of your family or either of your parents is a super senior citizen (i.e. 80 years or above in age) but is not covered by any health insurance, you can still get a tax deduction.
The tax deductions discussed above have been summarized in the table given below:
|Deductions under section 80D|
|Situations based on age||Eligible deduction limits (up to Rs.)||Total eligible deduction limit under section 80D (up to Rs.) (including Rs. 5,000 on preventive health checkup)|
|Medical Insurance Premium paid in respect of|
|Medical Insurance Premium paid in respect of||Parents (whether dependent or not)|
|No one has attained age of 60 Years||25,000||25,000||50,000|
|You and your family is less than 60 years & Parents are above 60 years of age||25,000||30,000||55,000|
|You and your parents have attained the age of 60 years and above||30,000||30,000||60,000|
Note: To claim deduction under this section health insurance premium should always be paid by any mode other than cash but medical or preventive health check-up expenses can be paid in cash.
The tax deduction currently allowed is up to Rs. 30,000 of the insurance covers you, your spouse or your children. You can get additional deduction of Rs. 30,000 on premium paid if you have a medical cover for your parents aged 60 years and above. If they are aged below 60 years, then the tax deduction cannot exceed Rs. 25,000.
However, if anyone of you, your spouse or your parents is not covered under any insurance policy, then you can claim a tax deduction up to Rs. 30,000 for the medical expenses incurred on them. Union budget for 2018 has extended this benefit to senior citizens as well and increased the deduction limit from Rs. 30,000 to Rs. 50,000.
A summary of deduction allowed under section 80D for AY 2019-20 is explained in the table below:
|Nature of amount spent||Family Member||Parents|
|Age below 60 years(value in Rs)||Age above 60 years(value in Rs)||Age below 60 years(value in Rs)||Age above 60 years(value in Rs)|
|A) Medical Insurance||25,000||50,000||25,000||50,000|
|B) Central Govt Health Scheme||25,000||50,000||–||–|
|C) Health Check-up*||5,000||5,000||5,000||5,000|
|D) Medical Expenditure||–||50,000||–||50,000|
Example: Mr Akash is 62 years old. He has a medical insurance policy on his name for which he pays a premium of Rs. 36,000 annually. He also pay premiums amounting to Rs. 28,000 annually for the health insurance policy of his parents who are above 80 years of age. How much tax deduction can he get under section 80D?
Solution: Since he is a senior citizen (above 60 years), he can get a deduction of up to Rs. 30,000 only for paying premium amounting to Rs. 36,000 since the maximum deduction limit is Rs. 30,000.
His parents are super senior citizens and therefore he is eligible for a tax deduction of Rs 28,000 out of the maximum possible deduction of Rs. 30,000 since the premium paid is only Rs. 28,000.
So, the total deduction that he can claim is (Rs. 30,000 + Rs. 28,000) Rs. 58,000.
Answer: Yes, you can claim a deduction in this case. This deduction is available to those who pay health insurance premium members of their family irrespective of whether the members are dependent on the person or not.
Answer: The answer is no because you can only claim Rs 5,000 in a year for these expenses whether for single dependent or multiple dependents. This deduction cannot be claimed per person basis but as an aggregate.
For e.g., If a person pays any amount on preventive health check-up (for himself + spouse & dependent children + parents), the gross total deduction allowed would not be more than Rs 5,000.
Just like section 80D, there are several other tax saving provisions covered under the Income Tax Act, but you might fail to claim the tax benefits in the absence of proper knowledge and procedures. So, you should take help of tax experts for this job. Saving taxes and filing income tax return accurately becomes very easy when you have professional help. This is where we come into the picture. You can visit any of our retail offices to get your taxes filed and avail year-round support in tax related matters.