A majority of Indians skip regular health check-ups in order to avoid expenses. But did you know that you can actually save money by availing them? Section 80D of the Income Tax Act provides deductions to taxpayers up to a certain limit when they opt for preventive health check-ups. What’s more, they help detect underlying diseases early on, enabling you to opt for treatment and safeguard both your health and finances.
This guide explains how you can benefit from Section 80D and lower your medical costs. Read on to make the most of this smart tax-saving opportunity!
Preventive health check-ups allow you to claim deductions on the charges spent on routine medical screenings under Section 80D. Introduced in the financial year 2013-14, this deduction encourages people to detect health risks early and reduce long-term medical expenses.
Individuals can claim up to ₹5,000 for preventive check-ups for individuals, spouses, and children dependent on parents. What’s more, this medical expense deduction is also available for cash payments.
Inclusion in the 80D Deduction Limit
The 80D deduction limit for preventive health check-ups falls under the overall section of ₹25,000 for individuals and ₹50,000 for senior citizens. So, the total claim, including health insurance premiums and preventive check-ups, should not exceed this limit.
Eligibility and Approved Institutions
To qualify for an 80D deduction, the check-up should be conducted at recognized hospitals or diagnostic centres. Hindu Undivided Families (HUFs) are also eligible to claim deductions under this section. While health insurance premiums should be paid in non-cash mode, preventive check-ups can be paid in cash.
Section 80D of the Income Tax Act provides tax deductions on health insurance premiums, enabling individuals to manage medical expenses better. However, to avail ourselves of this benefit, one must fulfil the following eligibility criteria:
Individuals and Hindu Undivided Families (HUFs)
Only individual taxpayers and HUFs are eligible for 80D tax benefits. Companies, partnerships, and other entities cannot claim deductions under this section.
Non-Resident Indians (NRIs)
NRIs paying taxes in India can also avail of an 80D deduction if they purchase health insurance from an Indian insurance provider.
Family Coverage
The tax benefit applies to health insurance premiums paid for:
Self
Spouse
Dependent children
Parents (whether dependent or not)
All medical insurance policy qualify for 80D deduction list benefits. Additionally, critical illness riders added to life insurance policies are also eligible for tax deductions under Section 80D of the Income Tax Act.
The Section 80D limits for different scenarios are listed below:
| Scenario | Health Insurance Premium deduction under Section 80D | Central Government Health Scheme Deduction (only for self, spouse, and dependent children) | Preventive Health Checkup 80D Deductions | Deductions Under Section 80D (Maximum) |
|---|---|---|---|---|
| Self, spouse, and dependent children | ₹25,000 | ₹25,000 | ₹5,000 | ₹25,000 |
| Self, spouse, and dependent children + parents (aged below 60 years) | ₹25,000 + ₹25,000 = ₹50,000 | ₹25,000 + 0 = ₹25,000 | ₹5,000 | ₹50,000 |
| Self, spouse, and dependent children + Resident parents (aged 60 years or above) | ₹25,000 + ₹50,000 = ₹75,000 | ₹25,000 + 0 = ₹25,000 | ₹5,000 | ₹75,000 |
| Self, spouse, dependent children (any person aged 60 or above and Resident) + Resident parents (aged 60 years or above) | ₹50,000 + ₹50,000 = ₹1,00,000 | ₹50,000 + 0 = ₹50,000 | ₹5,000 | ₹1,00,000 |
| Members of Hindu Undivided Family (HUF) | ₹25,000 | NIL | NIL | ₹25,000 |
| Members of Hindu Undivided Family (HUF) (aged 60 years or above and Resident) | ₹50,000 | NIL | NIL | ₹50,000 |
The tax benefits under Section 80D for health insurance premium payments are:
Tax Deduction on Health Insurance Premiums
One of the main benefits of 80D income tax is the deduction on health insurance premiums. Persons below 60 years of age can claim up to ₹25,000, and those above 60 years of age up to ₹50,000 per financial year.
This applies to policies covering yourself, your spouse, dependent children, and parents.
Preventive Health Check-up Cover
An additional deduction of up to ₹5,000 is allowed within the total limit for preventive health check-ups. These medical tests can include cancer screenings, thyroid tests, lipid profiles, blood sugar tests, ECG, etc.
Additional Deductions for Parents
If you pay health insurance premiums for your parents, you can claim additional deductions regardless of their age. This helps you maximize your tax deductions under the available 80D limits.
Pre-existing Diseases Cover
Health insurance policies covering pre-existing diseases also come under Section 80D of the Income Tax Act. If you are paying premiums for such coverage, you can claim tax benefits under the total applicable limits.
Critical Illness Cover
Many health insurance plans offer coverage for serious illnesses like cancer, stroke, and heart disease. The additional premium paid for critical illness cover is eligible for deductions under the 80D income tax benefit. This enables individuals to save on the extra costs incurred for availing themselves of this type of coverage.
Staying informed about tax benefits available under Section 80D of the Income Tax Act can help you make smart savings while safeguarding your health and finances. Also, ensure to track the latest updates regarding such deductions, as the rules keep are updated from time to time.
Now, if you are looking for an affordable health insurance plan that provides comprehensive coverage, try the Super Star plan from Star Health. Premiums start from just ₹13/day, making securing your health easier than ever.
Follow us on Google News