80D Tax Rebate

Buying medical insurance not only saves money on hospital bills but also on tax every year. Section 80D gives tax exemption on your health insurance premium.

Eligibility for 80D

An individual or HUF can claim 80D exemption if he is paying health insurance premiums for himself, spouse, dependent children or parents. If you are contributing to a Central Govt Health Scheme (CGHS) for yourself or family you can still claim the deduction. For availing this deduction on health insurance premiums, payment should not be made in cash.

You can claim deduction under section 80D for preventive health check-up of yourself and family as defined above. For preventive health check-up, payment in cash qualifies for tax deduction.

Maximum deduction limit under 80D

Your taxable income can be reduced by Rs 15,000 for health insurance premiums on family (self, spouse, children) and another Rs 15,000 for health insurance premiums or CGHS on parents, irrespective of whether they are your dependents or not.

Further, if you or parents are senior citizens (over 60 years) and a resident this limit is Rs 20,000. This is the maximum permissible limit. What you can actually claim is the higher of your medical insurance premiums and maximum limit mentioned here. Unfortunately, NRI senior citizens would not qualify for 80D health insurance tax benefit.

Deduction for preventive health check-up of up to Rs 5,000 is included under the overall limit of Rs 15,000 (or Rs 20,000). To get this rebate you must declare it while filing Income Tax Return. Your taxable income reduces by the amount you claim as exemption.

How to get 80D tax benefit

You can get 80D tax deduction for health insurance premium by submitting proofs to the HR so they adjust that while applying TDS on your salary or if you miss it you can still claim it while filing income tax returns. You would have to put the amount in cell allocated for 80D under Chapter VI-A deductions in ITR form.

Fintotal comment

Buying adequate medical insurance is of utmost importance for your financial life. Getting hospitalized can throw normal life out of gear for prolonged periods. In the absence of health insurance you might end up digging into your investments. So get a good health insurance policy for your family and claim income tax deduction on it.


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