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Business

Buying a Health Insurance Plan? Know How to Claim Tax Deduction

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Increasing healthcare costs is a matter of concern, there is an immense possibility that medical emergency occurs at any time. In such a situation, the role of health insurance to cushion the monetary impact of hefty treatment costs is vital. Health insurance serves dual purposes, it covers hospitalization and treatment expenses, subject to terms and conditions of the policy, and also give you tax benefits. This is why investing in good health insurance offers you a double bonanza. So, if you are buying health insurance here, you can read how you can avail health insurance tax benefit

Tax benefit on Health Insurance Premium

With the advanced treatment and financial security, you are also entitled to claim for tax deductions under a health insurance policy. According to section 80D of the Income Tax Act 1961, the premium paid against health insurance for self, dependent parents, spouse, and children has tax exemption. Let’s know how you can file the claim:

•If you have an individual health insurance policy and your age is below 60 years, you can get exemption up to Rs.25,000

•If you have purchased an individual policy for your parents who are below 60 years, then you can get exemption up to Rs.25,000

•In case if you have purchased a health policy for your parents who are above 60 years, you can get the tax exemption up to Rs.50,000

•But, if you have purchased health insurance for yourself and your elderly parents and your age is below 60 years, then you can get the reduction up to Rs.75,000

•Moreover, if you and your parents are above 60 years and you have purchased health insurance for yourself and elderly parents, then you can save up to Rs.1 lakh on tax.

Tax Deduction on Preventive Health Check-Ups

You must know that preventive health check-up is also cover under your health insurance policy. You along with, all the insured members, can avail it once in a policy year. If you pay a health insurance premium of Rs.22, 000 in a year and spend Rs.3, 000 on preventive health check-up, then you can file a claim for a tax deduction of Rs.25, 000. It is the maximum deduction limit for health insurance policy and preventive health check-up under taxation.

Key Pointers:

Investment in health insurance acts as your safeguard during medical emergencies. It not only supports you in a financial crunch but also helps to save more. Below are some things to keep in mind while filing health insurance tax deduction:
•Make the payment of the premium through net banking, cards, e-wallets, or other payment gateways.
•Any payment made in cash is not accepted by income tax department.
•Premium paid against health coverage for grandparents, siblings, paternal, and maternal relatives cannot be claimed under the tax deduction act.
•Premium paid by parents on behalf of working children for health insurance cannot consider for tax benefit.

The Indian Government has also encouraged people to opt for health insurance plans to save their hard-earned money. There are many health insurances companies like ICICI Lombard, HDFC Ergo, Religare Health Insurance, Star Health, etc. that provide a plethora of health insurance plans. You can opt for the best one that suits your healthcare needs and get health insurance tax benefit.

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