7 Important Facts That You Should Know About Section 80d

Having a healthy body is key to living a safe and stress-free life. Being healthy has numerous benefits. A healthy person is at a better physical, mental and emotional state.

However, at times in your life, you may face a health crisis, like a disease or other medical issues. And the treatment for such a crisis may put a lot of strain on your finances.
Hence, it is wise to go for a good healthcare plan in the early stages of your life. And the rising cost of medical care makes it even more important to have a good healthcare plan. 

A health insurance has many advantages. It reimburses the money spent on hospital bills. And apart from this coverage, individuals taking health insurances are also granted health insurance tax benefits under section 80D of the Income Tax Act on the premium that you pay.

Eligibility

Any person, whether salaried or self-employed, is eligible for health insurance tax benefits under section 80D if he or she pays any amount health insurance to ensure either their own, their spouse’s, their parents, or their dependent children’s health.

A joint Hindu family is also eligible for tax benefits if any member of the family pays premiums to ensure the health of any other member.

Limits on Section 80D

As per section 80D of the Income Tax Act, any tax payer can claim deductions for any health insurance premiums paid for self/family and/or parents. And these deductions do not include the deductions on expenses like health checkups. The table below gives the full information about health insurance tax benefits under section 80D for every possible scenario-

Seven relevant facts regarding Section 80D

Now that you know in general what section 80D of the Income Tax Act comprises of, listed below are seven important facts that you should know about health insurance tax benefits under section 80D:

1. Regarding deductions for installment paid for your parent’s health insurance. The amount you pay for your parent’s healthcare policies is eligible for tax deductions. And unlike the case of children, where the children needed to be dependent ones for your premiums to be eligible for tax deductions, the premium paid for parents does not depend on whether they are dependent or not. The deductions on premium paid for self, spouse, children or parents is capped at ₹25,000, as long as the age of the individuals involved less than 60 years. If anyone involved is a senior citizen, i.e. aged more than 60 years, the tax deductions are capped at ₹30,000. Hence, any tax payer younger than 60 years can have a total of ₹55,000 as tax benefits, if his parent's age is above 50. However, if he is older than 60 years, he can enjoy tax benefits of as much as ₹60,000.
2. One is not restricted to buy health plans only from health insurance agencies. The health insurance tax benefits under section 80D are on all kinds of installment paid for health policy. For instance, the premium paid for medical insurance riders or any critical illness also is eligible for tax deductions.
3. One gets health insurance tax benefits under section 80D on health checkups as well. Preventive health checkups get benefits up to ₹5000. However, the maximum deduction limit remains capped at ₹25,000 or ₹30,000.
4. To avail health insurance tax benefits under section 80D, premiums must be paid in non-cash modes only. Cash payments are not eligible for tax deductions. One may make use of internet banking, cheque, drafts, or even credit cards to make these payments.
5. A change has been made regarding uninsured very senior citizens of age more than 80 years. They are allowed tax deductions up to ₹30,000 on medical expenses.
6. Premiums paid for children above the age of 18 and employed are not applicable for deductions.
7. All individuals, as wells as HUFs (Hindu Unified Family), are covered under section 80D.