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The Health insurance tax benefits under the section 80D are listed in the table below. The table indicates the maximum amount of tax deductions for Self, Spouse, Dependent Children and Parents. All the plans listed as 80D medical insurance are eligible for the following deductions.
Description | Self, Spouse And Dependent Children | Parents(Whether Dependent Or Not) | Total Deduction |
No one in the family has attained the age of 60 years. | 25,000 | 25,000 | 50,000 |
Assesse and his family is less than 60 years and parents are above 60 years of age | 25,000 | 50,000 | 75,000 |
Assesse and his parents have attained the age of 60 years and above | 50,000 | 50,000 | 100,000 |
To help you understand how the type of policy affects health insurance tax exemptions, given below are examples of two different 80D medical insurance holders:-
Example 1:- Rohan (35) is a member of a family of six. His family constitutes of his wife (34), two children aged (10 & 7), father (65) and mother (60). He pays a yearly premium of Rs 15,000 for himself, his wife and two children. Additionally, he spends another 28,000 on his parent’s health insurance plan. Moreover, he spent Rs 15,000 for his wife’s health checkup and another 10,000 for his family’s health checkup. His total health insurance tax exemption will be as follows:-
As you can see, despite spending Rs. 68,000 as insurance premium, he could avail a mediclaim tax benefit of Rs 53,000.
Example 2:-
Renee is a senior citizen paying a premium of Rs 52,000 for herself, her husband and children. Apart from that she also pays a premium of Rs 55,000 for her parents who are senior citizens. Under the Section 80D of the income tax act, she is eligible for the following health insurance tax benefit:-
Apart from the 80D medical insurance benefits, there are several extensions of the tax act which is meant for individuals with specific needs such as:-
The Section 80DDB is applicable to individuals suffering from specified illnesses such as cancer, chronic renal failure, Parkinson’s disease etc. Such individuals can claim health insurance tax exemption up to Rs 2,00,000.
The Section 80DD is meant for the treatment for dependents with disabilities. You can claim tax benefit of up to Rs 75,000 under this section.
Under this section, disabled individuals can claim up to Rs 75,000. In case of severe disability, you can claim up to Rs 1,25,000.
Group Health Insurance: Group policies are not eligible for tax benefits.
Premium Payments in Cash: Premium payments made in cash is not eligible for tax benefits under the section 80D.
If you happen to pay health insurance premium for your sibling, you will not be able to claim tax benefits. However, for exceptional cases like severe physical or mental disabilities, you can claim tax deductions.
Similarly, if you are paying health insurance premium for your in-laws you will not be eligible for tax deductions.
If you pay your insurance premium in cash, you will not be eligible for medical insurance tax benefits. On the other hand, if you opt for a three year term policy, you can avail a discount of 10% on digital payments.
Accidents and illness can strike at any moment. To ensure that your children receive quality medical treatment, make sure they are covered under a family floater health insurance policy. For a small amount of premium, you can be assured of financial assistance at the time of emergencies.
Ensure that hospitals near you are listed under the hospital network of the insurance company. If it is not listed, you will not be able to avail the cashless facility.