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Section 80D: Deduction for Medical Insurance

Income tax Act allows for certain deductions from the gross annual income. Section 80D of the Income Tax Act, 1961 relates to the tax deductions on medical insurance. Section 80D of the Income Tax was introduced in 2018 with the aim to promote medical planning.

Eligibility Criteria under Section 80D:

An individual taxpayer is eligible to claim deductions under section 80D. The health insurance premium paid for the family members are eligible for Self, Spouse, DependentChildren, Parents. Hindu Undivided Families are also eligible to claim deductions under this section. NRIs too can claim this deduction.

Maximum deduction under Section 80D:

Following deductions are available under Section 80D:-

i) The maximum deduction of Rs. 25,000 per year on health insurance premium for self and family.

ii) The maximum deduction of Rs. 30,000 per year for senior citizens.

iii) The maximum deduction of Rs.25,000 per year on health insurance premium paid on behalf of parents.

iv) The maximum deduction of Rs.30,000 per year on premium payments for senior citizen parents.

v) Every year expenditure related to health diagnosis of Rs.5,000 can be claimed against all members in a family including spouse, kids, and parents.

vi) A HUF can claim a deduction under section 80D for a mediclaim taken for any of the members of the HUF upto Rs 25,000 if the member insured is less than 60 years and Rs 50,000 if the insured is 60 years of age or more.

Other Important points:

i) HUFs are, however, not eligible for health insurance tax benefits for preventive health-care check-ups.

ii) You can claim for the deductions only if the premiums are paid either by credit card or cheque.

iii) NRIs too can claim this deduction.

iv) Where a taxpayer has made a lumpsum premium payment in a single year for a policy valid for more than one year, he can claim a deduction equal to the appropriate fraction of the amount, under Section 80D.

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Note: This Post was last updated on January 23, 2023

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