Health Insurance Tax Benefits
Please note that following deductions are available as per the Income Tax Act with respect to the current financial year 2015-16 (AY 2016-6017). These can be availed till 31st March 2016.
U/s 80D
If you’re covered by a plan that provides health insurance for family, which includes yourself, your spouse, and your dependent children, you can avail an exemption up to INR 25,000. If you take health insurance for parents – who are senior citizens – as well, you can claim a deduction of INR 30,000 from your gross taxable income.
U/s 80DD
If you’ve paid the medical insurance premium for a handicapped dependent relative, you can claim a deduction of up to Rs 75,000 (the disability being between 40% and 80%).
In case the disability is severe, then the Income Tax Act provides a deduction of up to Rs 1,25,000 based on the medical expenditure incurred.
U/s 80DDB
Under this section, you can claim deduction on medical expenses incurred by you on the treatment of a relative suffering from certain health issues as specified in your contract. These include Dementia, AIDS, Parkinson’s, Chronic Renal Failure, Malignant Cancers, Thalassemia, Hematological disorders, and other specified Neurological diseases.
In any such case, you can claim a deduction of Rs 40,000. For senior citizens, the upper cap is set at Rs 60,000. In respect of the expenditure on the medical treatment of a very senior citizen, the maximum tax limit is Rs 80,000.
U/s 80U
Under this section, any Indian citizen who suffers from not less than 40% of disability is eligible for tax deduction of up to Rs 75,000. In case of severe disability, the maximum tax limit is Rs 1,25,000.
Investing in health insurance is a wise choice, both in terms of safety, as well as tax benefits.
How to Buy Health Insurance
You can buy a Mediclaim policy online from any of the insurance companies offering health insurance. But be sure to examine the fine print in the health insurance policies for any exclusions, sub-limits and co-pay. more