Investing in health insurance is the first step in financial planning, and it comes with several benefits. Along with protecting your family’s health and providing access to quality health care, the policy also helps you enjoy tax benefits and deductions.
Under Section 80D of the Income Tax Act 1961, health insurance is regarded as an essential investment, and thus you can claim tax deductions for the premiums paid. Deductions can be claimed for policies towards self, spouse, dependent children, and parents (senior and non-senior citizens).
If you’re also planning of investing to enjoy health insurance tax benefits, here are some key points to know and understand:
- Everyone under the age of 60 If no in the family insured is over the age of 60, you can claim health insurance tax deductions up to Rs. 25,000. If you’re paying premiums for health insurance of your parents under the age of 60, you can claim up to Rs. 25,000 of tax deduction. In total, the tax benefit could be up to Rs. 50,000.
- Either parent over 60 If anyone of your parents is over 60, you can claim a tax deduction of Rs. 50,000, for their health insurance premiums paid by you. Along with this, you can claim Rs. 25,000 deductions for the premium paid for your family including you, your spouse and dependent kids. In total, you can claim up to Rs. 75,000 in this case.
- Eldest family member over 60 If anyone in the family- you, your spouse, or children is over the age of 60, you can claim a tax benefit of Rs. 50,000 for the premium paid for your health insurance. Along with this, you can claim Rs. 50,000 for the premium paid for your parent’s insurance if their age is over 60. Altogether, your claim would be up to Rs, 1 lakh a year.
Claiming the Deduction:For claiming the deduction, you should provide your payment receipt of premiums, and the copy of your health insurance policy with the names and ages of all the members included mentioned clearly.
Note: Section 80C and Section 80D are often confused with each other. It is to be kept in mind that Section 80D only deals with deductions relating to premiums paid for health insurances, no additional investment.
Health insurances benefits are more than just good health care and tax deductions. With health insurance, you can rest assured that in the time of need, you will not have to worry about your medical expenses or risk not getting treated. Take your first step towards better financial planning and better health today.
Learn more about different Health Insurance Plans here.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
How to save on gift tax in India?
You need to pay taxes on gifts which exceed the limits set by the Government. However, gifts of any amount received or given from relatives including parents and spouse are tax-free.
Why Individual Health Insurance is a Must Buy Over Corporate Health Insurance?
It is a known fact that medical inflation is growing at twice the rate of regular inflation. While most salaried employees are entitled to health insurance provided by their employer, investing in individual health insurance, personalised to suit specific health conditions, has its merits.
What Is Trade Price In Stock Market & How Does It Work?
Also known as the market price, trade price of a commodity is the price at which it is currently selling in the market. In the context of trading, the price at which a share is being purchased or sold in the stock market at a given point of time is known as its trade price.
5 Types of Business Loan For Woman Entrepreneurs
There are now many different types of loans options in India for women wanting to explore their entrepreneurial dreams. Read this post to know 5 of the most popular options.