Maximise Your Tax Deductions Under Section 80D

Understanding the tax deductions can help you save a significant amount of your hard-earned money. According to Section 80D, you can claim tax deductions on money spent on health insurance premiums in a financial year. This blog will provide an outline of the tax deductions under Section 80D and all the other necessary information you need to know. Read more!  

Who is Eligible for Deduction Under Section 80D?

If you are an Indian citizen, a Non-Residential Indian, or a Hindu Undivided Family (HUF) member, you can claim tax deductions under Section 80D. However, if you are an organisation, commercial entity or firm, you cannot claim 80D deductions under this Section.

What Deduction is Allowed Under Section 80D?

Following are the types of deductions on expenses allowed under Section 80D:

1. Any amount paid as medical insurance premiums for self, spouse, children, and parents.
2. Payments are made as medical expenses for senior citizens if they do not have any medical insurance.
3. Any amount paid towards health check-ups to prevent diseases.
4. If you make any contribution to a Government Health Insurance Scheme.

Here is a table that illustrates the different slabs of health insurance tax benefit 80D limit available under Section 80D depending upon who is covered in the health insurance:

For Individuals

Policyholders	Deductions
	For self and family	For parents	For health check-ups to prevent diseases	Maximum Deductions as per Section 80D
Self and family below the age of 60 years	Rs. 25,000	-	Rs. 5,000	Rs. 25,000
Self and family, including parents, all below the age of 60 years	Rs. 25,000	Rs. 25,000	Rs. 5,000	Rs. 50,000
Self and family below the age of 60 years with parents above the age of 60 years	Rs. 25,000	Rs. 50,000	Rs. 5,000	Rs. 75,000
Self and family, including parents all above the age of 60 years	Rs. 50,000	Rs. 50,000	Rs. 5,000	Rs. 1,00,000

*It is important to note that family in this slab signifies dependent children and spouse.

For Hindu Undivided Families

Policyholders	Deductions
	For self and family	For health check-ups to prevent diseases	Maximum Deductions as per Section 80D
Members of a Hindu Undivided Family below the age of 60 years	Rs.25,000	Rs.5,000	Rs.25,000
Members of a Hindu Undivided Family above the age of 60 years	Rs.50,000	Rs.5,000	Rs.50,000

Deductions on Preventive Health Check-ups

In the year 2013-14, the Indian Government introduced Tax Deductions on Preventive Health Check-ups under Section 80D. You can get a deduction of up to Rs.5,000 Under Section 80D for any payments you make towards preventive health check-ups. However, this deduction of Rs.5,000 is not over and above of deduction of Rs.25,000 and Rs.50,000 as mentioned in table above. The limit of Rs.25,000 and Rs.50,000 is inclusive of preventive health check-up deduction.

You can avail of this deduction on any payment (including cash) for the preventive health check-up of yourself, spouse, dependent children, and parents.

Example:

Let us assume you pay Rs. 21,000 on health insurance for your family, which includes your spouse and dependent children. Other than that, you had a health check-up for which you paid Rs. 5,000.

When filing your tax returns, you will be able to claim Rs. 25,000 according to Section 80D of the Income Tax Act. Out of this, Rs. 25,000, Rs. 21,000 will be allowed for the premium of the insurance and Rs. 4,000 will be allowed towards the health check-up payment. Since this is the maximum limit, you cannot claim more than Rs. 25,000. 

Also Read - 9 Useful Income Tax Saving Tips For Small Businesses

Tax Benefits on Cash Payments

If you want to avail tax benefits under Section 80D of the Income Tax Act, you have to avoid the payment of premium using cash. Some of the ways how you can pay the amount are via demand drafts, cheques, credit or debit cards and net banking.

Nevertheless, you can pay for the preventive health check-up using cash. When filing your returns, you need to produce the bills of the health check-up to avail of the deductions under Section 80D. Also, keep in mind that the deductions are subject to the limits mentioned above.

Also Read - What are the Tax Benefits of MSME in 2024?

To Conclude

Now that you have a comprehensive idea about the tax advantages under Section 80D, you will be able to avail the deductions when paying the premiums for health insurance. Other than that, when availing Tax Deductions on Preventive Health Check-ups, you need to keep the medical bills so that you can produce the medical bills before your tax advisor or Income Tax Department, to substantiate your claim.

Disclaimer

This blog provides informational content on tax benefits and rules based on the current provisions of the Income Tax Act of India, 1961. The interpretations are subject to change as per amendments made by the Government of India. Applicable rates of GST and cess will be as per the current regulations. Readers must seek professional advice for accurate and up-to-date information.
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