Availing health insurance is now effortless, and hassle free, as the people don’t have to stand in long queues of government hospital any more. With the aim of promoting health insurance, the government is offering benefits under Section 80D of the income tax act, making treatments from private hospitals affordable, the Financial Express reported.
The report states ,under section 80D one now can avail health insurance premium till Rs 25,000 as taxable income if the policy is for self, spouse, and kids. Also, deductions till Rs 50000 can be claimed as taxable income if the premium paid on the policies is for the parents aged 60 plus. Hence, the permissible deduction of Rs 1 lakh can be availed, if the investors including his parents are senior citizens.
U/S 80D also includes the full amount paid to the union government health scheme by the government staff on any medical check up till Rs 5,000, though it’s within the specified range of Rs 25,000 and 50,000.
Therefore, from u/s 80D one can claim taxable income till Rs 1 lakh on the below mentioned conditions.
Be a policyholder or a proposer
Tax benefit u/s 80D is available either to the proposer or the policyholder, who has actually paid the premium in the financial year under consideration. So, you should be the proposer for the health insurance policies for both you family as well as of your parents, the Financial Express reported.
Only the policyholder or the proposer, who in reality has paid the premium in the specified fiscal year, can claim tax benefits u/s 80D. So, one must be the offerer for the health insurance policies for his own family and parents.
However, if either of the parents proposed while taking the health insurance policy for them, one can avail tax benefits on the premium paid, since he is not a proposer or a policyholder, even if he pays the premium.
No premium payment in cash
All other modes than cash is used for paying the health insurance premiums, to avail the tax tax benefits u/s 80D. So, to pay the premium one can issue a cheque or demand draft, or use net banking, debit card, credit card, bank transfer or other modes like online wallets etc. Additionally, the card or account used should be his.
If one pays the premium in cash on his own or if it’s paid by somebody else, the health insurance companies will not issue the certificate to avail the tax benefits easily. Hence, it’s important to pay the premium in other modes but cash for the policies, where he can be the policyholder or proposer or both, stated the report.
(With agency inputs)