Income Tax Deductions under Section 80D

To reduce your tax liability, the Income Tax Act provides several deductions. These Income tax deductions are reduced from your gross income, which reduces the taxable income and thereby the income tax liability according to your current income tax slab. Here are some deductions available:

With increasing lifestyle-related illnesses and escalating medical costs, there is no denying the importance of a health insurance plan. If you need hospitalization due to an illness, you are assured of the expenses being covered with a health plan. To encourage more people to procure health coverage, the government provides several tax deductions on the premium paid for these policies. These are illustrated below:

Under section >80D deduction is available on the premium paid for a health insurance plan. The maximum amount that is deductible is INR 25,000 and is available for the premium paid for procuring health coverage for self, children, and spouse. If you or your spouse is over 60 years old, the maximum deduction increases to INR 30,000 per year depending on your tax slab.

In addition to the deduction on the premium, you are allowed up to INR 5,000 per annum as expenses incurred towards preventive health checkup. Moreover, if you pay the premium for procuring health coverage for your parents, deduction of INR 25,000 is allowed. However, if your parents are aged over 60 years, the maximum limit increases to INR 30000 per year. This limit will increase to INR 50000 from April 1, 2019, as per the modifications made in the Budget 2018.

If a dependent suffers from any disability, you are allowed a deduction of INR 75,000 for expenses incurred towards treatment, rehabilitation, nursing, and preservation. This deduction under section 80DD increases to INR 1.25 lakh if the severity of the disability is very high.

For certain defined illnesses, you may claim tax benefits under section 80DDB. The total benefits available are up to INR 1.4 lakh (INR 60,000 for individuals aged over 60 years and INR 80,000 for super seniors whose age exceeds 80 years).

Frequently Asked Questions (FAQs)

If you pay the health insurance premium for self, children, spouse, or parents, you are eligible to claim deductions. Additionally, if you incur expenses for treatment or checkup of parents aged over 80 years, you are eligible to claim the tax benefits. However, payments must be made either in check or through net banking or via debit or credit cards. You can additionally check our guide on tax slabs to understand in which category you will be considered.

Yes, deductions under section 80D are available for HUF taxpayers within the limitations set by the Income Tax Act. The total deduction available is capped at INR 30,000 per year.

No, any premium paid to procure coverage under a group health insurance policy is not eligible for tax benefits under this section. However, if you purchase an individual policy in addition to the group plan, the premium of the former is eligible for deductions.

If you receive treatment in a foreign country, you are eligible for tax deductions. However, it must be allowed by your health insurance plan and the insurance company must be registered with the Insurance Regulatory and Development Authority of India.

No, if your children are not dependent, insurance premium paid on their behalf is not eligible for deductions. However, your children may claim the benefits while filing their returns. Health insurance premium tax benefits are available for multiple policies. However, all these will be guided within the maximum available limits as per the Income Tax Act.

While you apply for income tax deductions also check other sections of the income tax act. Section 80C allows a person to reduce his/her gross taxable income and thereby the total tax payable by him/her. If you have taken an education loan and are repaying the same, then the interest paid on that education loan is allowed as a deduction from the total income under Section 80E. Explore out tax guide section to see if you are eligible for more deductions.