Tax Deductions on Health Insurance
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Do you know with comprehensive health insurance, you can shoot two birds with one arrow? That's right! A premium paid towards health insurance policy gives financial support during a medical emergency and is also entitled to tax exemption. Under section 80 D, of the Income Tax Act 1961, the premium paid on health insurance for self, dependent parents, spouse, and children comes under tax deductions. It reduces your taxable income and shows less tax liability. Therefore, it plays a vital role in your investment portfolio. Before you jump to tax benefits here, you can read what section 80D is and how health insurance avails you tax benefits under this act.
What is Section 80D of the Income Tax Act of India?
Section 80D comes under the Income Tax Act of India that allows tax deductions from the gross taxable income for the payment of health insurance premium paid by an individual or the Hindu Undivided Family. A premium paid against health insurance policy for self, dependent parents, spouse, and children is all exempt from tax. Under this section, health insurance premiums, contributions to the Central Government Health Scheme, and preventive health checkups can claim for a mediclaim deduction.
However, the quantum of tax benefits in individual and family health insurance depends on the insured's age and income. It also provides tax benefits by reducing taxable income and shows less tax liability. The Indian government is also encouraging citizens to opt for health insurance that allows saving the right amount of money on tax under section 80D. The premium paid against a health insurance policy is exempt from taxation.
How to Avails Tax Deductions in Health Insurance?
Read here how you can avail benefits against under health insurance policy:
Tax Reduction on Health Insurance Premium
Premium is the amount that you have to pay to the insurance company against the sum insured. Under Mediclaim 80D of the Income Tax Act, a premium paid for the health insurance plan for self, dependent parents, spouse, and children gets exemption from tax. You can claim Rs.25,000 for individual and family health insurance and up to Rs 50,000 for senior citizens per year.
Tax Reduction on Health Check-Ups
You should know that under your health insurance policy, you can get an annual health checkup. It includes blood sugar tests, urine tests, cholesterol tests, ECGs, etc. According to Mediclaim 80D, you can avail of tax reduction on annual health checkups up to Rs. 5,000.
Other Health Insurance Tax Benefits
Premium paid against health insurance for very senior citizens like 80 years, treatment of specified illnesses, and treatment of a dependent with a disability, are all come under a mediclaim deduction. It reduces your taxable income low that reflects less tax liability.
How to File Tax Return?
Filing a tax return is not a daunting task. Following simple steps can ease the process:
A sound health insurance policy provides you and your family a comprehensive medical coverage and supports you in your tough time. It bears your medical expenses and avails the best possible treatment. Its benefits do not limit here, along with the right treatment and financial security; you are entitled to get a mediclaim deduction under 80D of the Income Tax Act. That is why investing in the right health insurance offers you a double bonanza. In this article, you can read how you can avail health insurance tax benefits.
Things to Be Noted Before Filing for Tax Return
How to Maximize Health Insurance Tax Benefits?
The following steps can help maximize tax deductions in health insurance:
Health insurance serves a dual purpose. The Indian government also encourages citizens to opt for health insurance to save the right amount of money on tax under section 80 D. In this way, it supports you in a financial crunch and increases your savings. So, don't scorch your mind more. Opt for Care- an exclusive health insurance policy offered by Care Health Insurance (Formerly Religare Health Insurance) that gives you maximum coverage with a plethora of tax benefits.
*Note: Tax reduction on health insurance premium is subject to rules and regulation of Income Tax Act. Please refer to them before filing the return.