Do you have a medical insurance policy?

If no, then you are surely taking a lot of risk as far as your future is concerned.
If yes, then you are a smart investor who invests in his health not only for today but for his future as well.
As it is very aptly said “Health is Wealth”.
With aim to promote health planning among individuals, government introduced Sec 80D.


What is Sec 80D?

Sec 80D provides deduction of premium paid on your medical insurance policy.


Who is eligible for Sec 80D?

You can avail this deduction on the premium of medical insurance policy taken for:

  • Yourself
  • Wife
  • Dependent Children
  • Parents

A HUF also enjoy this benefit on policy taken for its members.


What is the amount of deduction under Sec 80D?

This section has very wide coverage.
So to simplify it, let’s divide deduction amounts in 4 types, i.e.

A.  Deduction of medical insurance premium paid for yourself & your family.
B.  Deduction of medical insurance premium paid for your parents/ senior citizen.
C.  Deduction of amount paid on preventive health check-up.
D.  Deduction of amount paid on medical expenditure of Super Senior Citizens.
E. Deduction in case of HUF.

Let’s start discussing all different situations one-by-one or you can simply get in touch with our eCAs


Deduction of Medical Insurance Premium: For You & Your Family

The maximum amount of deduction on policy taken for you & your family is Rs. 25,000/-

If you are a senior citizen then deduction amount will be Rs. 30,000/-

Family includes your wife & dependent children.

Senior citizen means resident individual of 60 years or more at anytime during previous year.

With effect from F.Y. 2018-19, max deduction limit for senior citizen is Rs. 50,000/-


Deduction of Medical Insurance Premium: For Parents/ Senior Citizen

In addition to above, you can claim deduction of medical insurance premium paid u/s 80D for your parents as well.

The maximum amount of deduction is Rs. 25,000/-

If your parents are senior citizens then deduction amount will be Rs. 30,000/-

From F.Y 2018-19, the maximum deduction for senior citizens has been increased to Rs. 50,000/-

Section 80D

Deduction of Preventive Health Check-Up Amount

It is like a regular health check-up conducted once or twice every year by your GP.

The amount of deduction for this check-up is maximum Rs. 5,000/-


Deduction of Medical Expenditure: Super Senior Citizen

This deduction is given when no medical insurance policy is taken.

Deduction can be taken for yourself or your wife or parents.

The maximum deduction amount is Rs. 30,000/-

The only condition is that age of individual should be 80 years or more at any time during previous year.

From F.Y 2018-19, the amount of deduction has been increased from Rs. 30,000 to Rs. 50,000 for senior citizens.


Deduction for HUF

HUF can take medical insurance policy for any member of family.

The maximum amount of deduction is Rs. 25,000/-. If the member is senior citizen then maximum deduction will be Rs. 30,000/-

From F.Y 2018-19, the maximum deduction for senior citizens has been increased to Rs. 50,000/-


Some Other Important Points

  • Any amount paid by you as medical insurance premium or medical expenditure should be in any mode other than cash.
  • Amount paid for preventive check-up can be in cash or any other mode.
  • In Budget 2018, a very advantageous provision was introduced. If medical insurance premium paid by you is in lump-sum amount for more than one year of insurance policy. In that case, it’ll be allowed as proportionate deduction over policy years subject to limits specified above.

Our Thoughts

A medical insurance policy is very important for each one of us.

No one can say “I’ll be healthy throughout my life”. These policies provide a strong monetary support when you are in sudden requirement of huge amounts of money.

If you haven’t taken one yet, we strongly recommend you to think again!

We hope our blog was able to clarify all your doubts on deduction for medical insurance.

If you have any further doubts, don’t forget to get in touch with our eCAs.. They are at your service 24×7. Happy Filing ????


Section 80D at a Glance

Section 80D

 

Frequently Asked Questions

Q- Can a term insurance premium be claimed as a tax exemption under Section 80D?

Ans. No., it cannot be considered as tax exemption under this section.


Q- Can a son claim tax exemptions on paying for parents mediclaim?

Ans. Yes, son can claim for aorents mediclaim as per section 80D


Q- Does LIC premium payment of my dependent parents come under section 80D?

Ans. No, Sec.80D is for medical premium and for health insurances.


Q- Do I have to be the proposer of a health insurance for myself to get a deduction from income tax u/s 80d?

Ans. No, taxpayer can claim deduction on proportionate basis.


Q- What is the limit of income tax exemption under section 80D?

Ans. The maximum limit u/s 80D is Rs. 25000 (in case senior citizen Rs. 50000)and in case both assessee and parents are senior citizen , then amount can be claimed upto INR 100000


Q- Does the GST paid along with LIC health insurance premium is eligible for tax deduction under 80D?

Ans. Yes, the whole amount paid will be available for deduction


Q- Can I claim tax exemption under section 80d if I have cashless medical insurance provided by my company?

Ans. Yes, provided your company include that premium paid into your CTC.


Q- I am not using the Mediclaim policy, but I incurred a charge of Rs 7000 for preventive health check ups for my wife and I. Is a deduction of Rs 5000 allowed under section 80D for payment of a preventive health check up for myself?

Ans. Yes., Section 80D allows you claim deduction for health checkup taken for spouse, parents and dependant children.


Q- Can health insurance premium be used for tax saving under 80D even if the employer reimburses the premium paid?

Ans. No, it will not be an expense for the employee if reimbursed by the employer.


CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.