Maximizing Your Health Investment: Preventive Check-ups and Tax Benefits

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 Under Section 80D: An Overview

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.

Who is Eligible for Health Insurance Tax Benefit Under Section 80D?

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:

1. 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.

2. 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.

3. Family Coverage

The tax benefit applies to health insurance premiums paid for:

• Self

• Spouse

• Dependent children

• Parents (whether dependent or not)

Health Insurance Policies Eligible for Deduction

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.

Section 80D Deduction Limits for Different Scenarios

The Section 80D limits for different scenarios are listed below:

Tax Benefits of Health Insurance Under Section 80D

The tax benefits under Section 80D for health insurance premium payments are:

1. 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.

2. 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. 

3. 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. 

4. 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.

5. 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.