The Tax Benefits Offered by Health Insurance Policies Under Section 80D
Life or health insurance gives the insured two advantages: financial security during an emergency and a tax deduction when filing an income tax return. Under section 80D of the Income Tax Act, health insurance is a very effective tax-saving tool.
Under health insurance, the insurer promises to cover the insured’s medical expenses during a medical emergency in exchange for regular premium payments. There are more health insurance benefits than assisting you during emergencies. It reduces the annual income tax you must pay for the fiscal year, subject to the premium paid. Please note that Tax benefit is subject to change in tax laws.
What exactly is section 80D of the Income Tax Act?
Section 80D provides tax benefits to every individual or HUF member who has purchased a health insurance plan for a family, up to a maximum of Rs. 25,000.
Deductions available under Section 80D
If you pay a premium for a family up to Rs. 25,000 and for parents over 60 up to Rs. 25,000, you can deduct up to Rs. 50,000 under section 80D.
- If you pay a premium for a family up to Rs. 25,000 and for parents over 60 up to Rs. 50,000, you can deduct up to Rs. 75,000 under section 80D.
- If you pay up to Rs. 50,000 for health insurance for yourself, your family, and any guardians over 60, you can deduct up to Rs. 1,00,000 under section 80D.
- For Hindu Undivided Family (HUF), the deduction under Section 80D can be up to Rs. 25,000 for health insurance paid.
- For Non-Resident Individuals, the deduction under Section 80D can be up to Rs. 25,000 for health insurance paid for themselves, their families, and their parents.
* Standard T&C Apply
The tax advantages of health insurance
If an individual’s annual income is subject to taxation, having a health insurance policy allows for a partial exemption from income tax. Every life and health insurance policy would enable you to deduct your premium payments from your taxes. Please note that tax benefit is subject to change in prevailing tax laws.
Ensure adequate coverage when purchasing a health insurance plan for senior citizens. Try to purchase policies that cover all medical conditions of your parents. This can maximize the benefits of the health insurance policy you have purchased. This can also ensure that you do not have to worry about the financial repercussions of medical emergencies. Please note that Tax benefit is subject to change in tax laws. * Standard T&C Apply
Tax Benefits of Health Check-ups: preventive health check-ups receive up to Rs.5,000 in reimbursement depending on age.
This means that if you pay Rs. Twenty thousand in health insurance premiums towards a medical claim and undergoing a health check-up costing Rs. 5,000, you can claim a total of Rs. 25,000 under section 80D. The majority of reputable hospitals offer preventive health examination packages.
Per the income tax law, you are eligible for a tax exemption of Rs. 5,000 for all expenses incurred for preventive health examinations for your parents aged 60 or older. Please note that Tax benefit is subject to change in tax laws. * Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.