Posted by Medical emergencies can come up at any time. It is always better to be on the safe side than to be late, and it is no different when it comes to medical insurance. The majority of the population in India is not covered under health insurance and depends on their savings or borrowing in times of medical emergencies. A must in your investment portfolio, the government encourages every citizen in India to buy medical insurance and allows you to avail of tax deductions on it under section 80D. A lot of insurance companies do not offer health insurance plans to old people with pre-existing health diseases. So the government took into consideration and announced amendments to section 80D under the income tax act in the 2018 budget. If you are confused about what is section 80D, and how to save medical bills under section D here are some suggestions for you to look up:
What Is Section 80D?
Every individual can claim a deduction from their total income for medical insurance premiums paid in any given year under section 80D. This deduction is also available for top-up health plans and critical illness plans. This deduction benefit is available not only for a health insurance plan but one can take benefit by buying the policy to cover a spouse, children, or parent. The best part about this policy it is over and above the deductions claimed under section 80D.
Who Is Eligible For Deduction Under Section 80?
One of the criteria to claim a deduction for this bill is that the medical expenses must sustain one of the family members or parents who are aged 60 years and above. The law determines the family members as the person themselves, spouse, and dependent children. Another condition is that the person for whom the medical expenditure has been sustained should not be covered under any health insurance policy.
Who Can Assert This Deduction And How To Assert Deduction Under Section 80D?
The deduction for medical expenditure can be claimed by the person who has incurred the medical expenditure. Therefore, if you are a senior citizen and you are not covered under any health insurance policy, then you can claim the deduction yourself.
How deduction can be asserted under section 80D?
A tax deduction can be offered on individual health insurance. Premium-paid health insurance can be taken for self, dependent children, or dependent parents are only allowed for deduction. The criteria for taking a deduction for dependent children can be either an unemployed male child up to the maximum age of 25 years or an unemployed female child until she is unmarried. Premium-paid health insurance is not allowed for siblings.
What is the maximum deduction under section 80D?
The maximum amount that can be claimed as a deduction under section 80D is the same as the maximum deduction that can be claimed for the premium paid health insurance. You can maximum avail yourself of the deduction of up to RS 50,000 in a financial year. Below is the table explaining the maximum deduction that can be done towards the medical expenditure and what is the limit required to claim the deduction, for family members whose age is below and above 60 years, and for parents whose age is below and above 60 years.
Table With Tax Deduction Limit Under Section 80D With Different Schemes.
| Family member | Parents | |||
| Amount spent | Age below 60 years | Age above 60 years | Age below 60 years | Age above 60 years |
| Medical insurance | 25,000 | 50,000 | 25,000 | 50,000 |
| Central government health scheme | 25,000 | 25,000 | Not available | Not available |
| Health Check-up | 5,000 | 5,000 | 5,000 | 5,000 |
| Medical Expenditure | Not available | 50,000 | Not available | 50,000 |
| Maximum deduction U/S 80(D) | 25,000 | 50,000 | 25,000 | 50,000 |
What Is Covered Under Medical Expenses under Section 80D?
Any diseases or medical expenses that are not mentioned in the Income-tax ad won’t be covered. However, expenses that are acquired are on medicines, consultation fees, hearing aids, and pacemakers shall be considered under the amendment which is made by the government. Some medical expenditures on certain diseases can be covered under section 80DDB, and if any medical expenses don’t come under the given category of section 80DDB or in case the given limits have been exhausted then the remaining medical expenses can be claimed under section 80D. The maximum deduction that is allowed under this category in a financial year is Rs50,000.
Preventive Health Check-Up
Section 80D also offers preventive health check-ups for a maximum of Rs up to 5,000. The payment for the preventive health check-up can also be done through cash. The amount of Rs5,000 can falls under the overall deduction that can be made to an individual. A preventive health check-up means an early check-up when the disease is detected and safeguards again any possible exposure to the disease in the future.
Documents Required To Claim Tax Deduction
The documents that are required to claim any tax deduction are not mentioned in the Income-tax act. However, if you are smart you can save the documents for the future if needed and those evidence bills could be medical invoices, reports of a diagnostic test, doctor’s prescription, and so on.
Conclusion
Any medical expenses that a person acquires on himself or his/her family member including senior citizens are allowed to avail of tax benefits under section 80D. The medical bills that are paid by the individual for his/her parents or by a senior citizen themself are also allowed for tax benefit under section 80D. According to section 80D of the income tax act, senior citizens can benefit from a deduction of up to Rs50,000 for payment of premium towards medical insurance policy as mentioned above.
This limit includes expenses sustained, on preventive health checkups limit of up to 5,000. However, if no amount is paid as a premium on health insurance, medical expenses can sustain by such senior citizens. If you want to save the tax on your bills you can claim medical insurance and for claiming medical expenses, a personage should be above 60 years or above.