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Deduction under section 80 D- for Medical Insurance & Health Checkup

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BUY BEST MEDICAL HEALTH PLAN

Deduction under this section is available to an individual or a HUF. If you and your family are not covered under any medical health plan, then you must buy it first. Because it provides you and your family a financial support for medical treatment. Without any Insurance health plan, a sudden health issue can eat all your savings.

Medical insurance not only provides you support at the time of need, but is also a good way to save tax on amount of premium paid.

See the related post: Deductions under Chapter VIA
 

Eligibility under this scheme- Premium paid for health insurance and health checkup expenses:

In Case of Individual-
  • You & your spouse
  • Dependent Children
  • Parents dependent or not
In case of HUF-
  • On the health of any member of the family
 

Amount of Deduction-

Deduction of Rs. 25,000 can be claimed for insurance of self, spouse and dependent children. An additional deduction for insurance of parents is available to the extent of Rs 25,000 if they are less than 60 years of age or Rs 50,000 (has been increased in Budget 2018 from Rs 30,000) if parents are more than 60 years old. In case, a taxpayers age and parents age is 60 years or above, the maximum deduction available under this section is to the extent of Rs. 100,000.

Maximum amount of deduction allowed is as follows: - w.e.f. Financial Year 2018-19
Particulars Self, spouse and dependent children (A) Parents (dependent or not) (B) Total amount allowed (A+B)
If Self, Spouse, Children and his Parents are below the age of 60 years 25,000 25,000 50,000
If Self, Spouse & Children are below the age of 60 years but his parents are senior citizen 25,000 50,000 75,000
If  an assesse self, his spouse and parents are senior citizens 50,000 50,000 1,00,000

EXAMPLE- 1.
Mr. Ramesh age of 35 years, pays medical insurance premium of Rs. 28,000/- on his health and health of his wife and dependent children and pay Rs. 42,000/- on the health of his parents who are the age of 58 years. What will be the amount of deduction under section 80D during the financial year 2018-19?

Answer:- Mr. Ramesh would be eligible for a deduction under section 80D for Rs. 50,000/- (Rs. 25,000 + Rs. 25,000) during the financial year 2018-19. In such case where both are not senior citizens the deduction can be claimed up to maximum of Rs. 50,000.

EXAMPLE- 2
Mr. Ramesh age of 55 years, pays medical insurance premium of Rs. 28,000/- on his health and health of his wife and dependent children and pay Rs. 42,000/- on the health of his parents which are senior citizens. What will be the amount of deduction under section 80D during the financial year 2018-19?

Answer:- Mr. Ramesh would be eligible for a deduction under section 80D for Rs. 67,000/- (Rs. 25,000 + Rs. 42,000) during the financial year 2018-19. In such case where assessee is not senior citizen while his parents are senior citizens the deduction can be claimed up to maximum of Rs. 75,000.

EXAMPLE- 3
Mr. Ramesh age of 65 years, pays medical insurance premium of Rs. 28,000/- on his health and health of his wife and dependent children and pay Rs. 42,000/- on the health of his parents which have also senior citizens. What will be the amount of deduction under section 80D during the financial year 2018-19?

Answer:- Mr. Ramesh would be eligible for a deduction under section 80D for Rs. 70,000/- (Rs. 28,000 + Rs. 42,000) during the financial year 2018-19. In such case where both are senior citizens the deduction can be extended up to maximum of Rs. 100,000.

Special deduction for Senior Citizens or Super Senior Citizens under section 80D-
If you or any member of your family or either of your parents is Senior Citizen or Super Senior Citizen (i.e. 80 years or above in age) but is not covered under any health insurance, you can still get a tax deduction of Rs. 50,000 (w.e.f. 2018-19). The deduction is allowed for medical expenses.

Preventive Health checkup covered under section 80D-
Preventive health checkup expenses to the extent of Rs 5,000/- can be claimed as tax deductions. Keep in mind, this is not over and above the individual limits as explained above.

Example – 
Mr. Samir (65 years) has a Mediclaim policy and paid Rs 55,000 as premium. He also spent Rs 8,000 towards health check-up. What will be the deduction amount under section 80D?

Answer-
Mr. Samir is a senior citizen, he can claim deduction to the extent of Rs 50,000 only under Section 80D. Even he has paid Rs. 63,000/- (Rs. 55,000+ Rs. 8,000). The deduction of health check up is included in tax deduction slab.

Mode of Payment-

Health Insurance Premium must be paid through cheque or any mode except cash, while expenses on health checkup etc can be paid in cash.


See the related post : How to E-file Income Tax Return



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