Know Everything Related to Health Insurance Benefits under Section 80D read
Jul 27 2020898 Views
We all know that health insurance acts as a safety valve against unforeseen medical expenses. It is the most foolproof way of accessing quality healthcare in times of emergency. It boosts our morale and financial confidence while undergoing medical treatments. Thus, purchasing medical insurance is the key to affording primary treatment without facing debt.
Going beyond the treatment compensations and the medical coverage, you also have a provision of tax exemptions for the health insurance premiums you pay towards the policy. This way, your access to healthcare amenities becomes easier.
The Government has implemented several policies with the motive of making quality healthcare accessible. Section 80D of the Income Tax Act in India is one such example. It entails the deduction for medical insurance in the form of premium payable.
Deductions for Medical Insurance under Section 80D
- Under section 80D of the Income Tax Act, you can avail various tax benefits. You can claim deductions up to Rs.25,000 per financial year on the premium charged. Such a deduction for medical insurance is applicable for you, your spouse, and your children.
- You can also avail tax benefits for annual preventive health check-ups. The claim can be up to Rs.5,000 under the Income Tax Act Section 80D.
- You can avail deductions on the health insurance premiums charged for your parents. If the parents are senior citizens, you can claim up to Rs.30,000 per financial year. It also includes an additional sum of Rs.5,000 for annual health check-ups. Thus, it is evident that various deductions for medical insurance can be obtained under section 80D.
- Thus, under Section 80D of the Income Tax Act, you can get tax deductions for the entire family. However, you are not entitled to claim tax benefits in the medical coverage for siblings.
Exclusions under Health Insurance Section 80D
- A key point you must remember here is that the deductions apply to trackable payment only. No tax benefits can be attained through premium payment via cash.
- The service tax charged on health insurance premium is 15%. There is no financial relaxation concerning that amount. You must have to pay the service tax and cess charges levied on the insurance premiums.
- The tax benefits under Section 80D are not applicable for Group Health Insurance policies. However, if you wish to enhance the medical coverage by paying a higher premium, you can avail deductions on the premium paid for group health insurance.
To conclude, you can claim considerable tax benefits and deductions towards the health insurance premiums under section 80D of the Income Tax Act. The important reason for owning medical insurance is to secure your future financially against uncertainties. Delaying to purchase medical insurance may cause a severe financial crisis in emergencies. You should scrutinize every word of your policy to derive proper medical aid and financial assistance. Make an informed decision today and stay ahead of your problems.