Section 80D

In the union budget 2018, the government of India has proposed the below changes for deductions available on Health Insurance and/or towards Medical treatment. The same provisions are applicable for FY 2019-20 as well;

On October 12, 2019 by www.taxexcel.net

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Section 80D: Income Tax Deduction for A.Y. 2019-20 & F.Y 2018-19. Section 80D deduction Relevant for Assessment Year  2019-20/Financial Year 2018-19 as proposed by Finance Bill 2018 | Relevant for Assessment Year  2019-20/Financial Year 2018-19 are given below.

Having a health insurance policy does not only help cover your medical expenses, but it also gives you relief from tax liabilities. Section 80D of the Income Tax Act 1961 allows taxpayers to claim deductions for health insurance premiums paid for insuring self, spouse, dependent children, and parents. The maximum tax deduction that can be claimed under this section is Rs. 25,000. If any of the persons specified is a senior citizen, the maximum deduction amount is Rs. 50,000.

On September 26, 2018 by www.taxexcel.net

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Section 80D offers one of the best tax-saving benefits in India, which specifically provides deduction in taxable income to the extent of premiums paid on the purchase of health insurance or medical insurance / mediclaim products. A really wonderful feature of this deduction is that it even includes the premiums that you pay for the health insurance of your parents, children, and other family members. Not just that, tax benefit under Section 80D is over and above benefits under other sections such as 80C, 80CCC, 80CCD, 80CCD2, etc. Not using the benefit from Section 80D would be foolish since besides losing the tax benefit, it also means that you do not have any health insurance or medical insurance / media claim.

Section 80D – Eligibility for Deduction

The deduction of premium paid on Health Insurance or Medical Insurance / Mediclaim under Section 80D can be availed of by any Indian taxpayer at the level of Individual or HUF (Hindu Undivided Family). The person claiming the deduction has to be the one who pays the premium for all members. The family members for whom the taxpayer can claim the deduction under Section 80D are as follows.

Self

Spouse

Parents

Dependent Children (non-earning male students up to age 25 only, non-earning females only till they are married)

Please note that other family members can indeed be covered by a health insurance or medical insurance / mediclaim plan (both individual and family floater), but the premium paid for them cannot be included for tax benefit under Section 80D.

Brothers and Sisters

Uncles and Aunts

Father-in-law and Mother-in-law

Grandfathers and Grandmothers

Nephews, Nieces, Cousins

Any other relatives

Annual Health Check-Up Expenses for the entire family also covered
In addition to the above, effective from A.Y 2017-2018, the cost of annual health check-up incurred on eligible members are also covered to the extent of  5,000 for the entire family put together. It may not be enough as such, but it certainly helps.

Medical Expenses of Super Senior Citizens above Age 80 also covered
In addition to the above, effective from FY 2015-2016, medical expenses of octogenarians, nonagenarians, and centenarians, can be included.  That is, medical cost is allowed for deduction under Section 80D for very senior citizens beyond 80 years of age.  This is available up to the entire limit of 30,000 (explained below). This benefit is allowed only if they are not covered by any health insurance policy.

NRIs are also covered under Section 80D
Yes, NRIs can also claim this tax benefit. The limits are exactly the same.
 

Section 80D – Extent of Deduction in a Financial Year

The limits up to which the taxpayer can claim benefits under Section 80D depend on the coverage of health insurance and medical insurance / mediclaim plans.

Section 80D – Points to Note before Claiming Deduction

Medical Allowance : Tax Benefit under Section 80D is NOT the same as Medical Benefit which is part of your salary for which currently the limit is  25,000 for below 60 Years and Rs. 30,000/- above 60 Years. It is over and above the Medical Benefit, so you can claim BOTH – Health Insurance / Mediclaim under Section 80D and Medical Allowance under Section 10. They will appear separately in your Form 16.

Multiple Policies : You can claim for more than 1 health insurance policy.  Do ensure you meet all the eligibility criteria for premiums paid for all the policies.

Top-up Health Policies : Top-up health insurance or medical insurance / medical plans are also eligible for the benefit.

Policy Proposer : It is not necessary that the taxpayer needs to be the proposer of the policy – she/he just needs to pay the premium to keep the policy in force.

Renewal Premium : You can indeed claim for renewal premium paid to keep a health insurance plan in force.  Do ensure it meets all other conditions mentioned herein.

Health Check-Up Expenses : Health check-up deductions are all-inclusive for family members put together. That is, for all family members (self, spouse, dependent children, parents) together to the extent of  5,000. It is NOT for each family member – do note that.

Salary Deduction : In case, you are paying the health insurance premium through Salary Deduction, you are still eligible to claim benefit under this section, as long as it is not a Group Health Insurance plan.

Independent Parents : Under Section 80D, one cannot include premiums paid for independent children, i.e. children who are earning income. However, you can claim this benefit for earning spouse and earning parents, i.e. even if they not dependent on you.

Part Payment by Individuals : In the case of part payment by you and a parent, both of you can claim the deduction to the extent paid by each.

Section 80D – Exclusions

Mode of Premium Payment : Only the taxpayer, and not a third party, can pay the premium for all the family members for whom tax deduction is claimed. Cash payments are NOT allowed for tax benefit – any other mode including online, debit/credit cards, etc. are acceptable.

Exclusion of Service Tax : When claiming tax benefit, deduct the Service Tax and Cess portion from the premium amount.

Group Health Insurance and Group Mediclaim : Group Health Insurance premium provided by the company is NOT eligible for deduction under Section 80D. However, if you pay any premium to enhance the group cover for eligible members, you can indeed claim this contribution within the overall limits applicable for you.

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Make your Health Insurance plan almost free with Section 80D!

As mentioned in the beginning, it is foolish not to use Section 80D tax benefit. Here’s a simple calculation.

A health insurance family floater product for a family of 2 adults (under age 45) and 2 children costs say Rs. 10,000 per annum (when you buy online) for a Sum Insured of Rs. 5 lakhs.

·             The biggest benefit is Health Insurance itself which is very beneficial.

·             Add to that the benefit from Section 80D. If you are in the 30% Income Tax bracket, you straight away save Rs. 3,000

·             Insurance companies generally offer free annual health insurance check-ups (costing Rs. 3000-4000 per person) to adults covered in the health insurance plan. This saves you another approximately Rs. 7,000 per annum!

So the 80D benefit and the benefit of Annual Health Check-up together compensate the premium of Rs. 10,000. Plus you get the benefit of Health Insurance from the policy renewable for your whole life! Which is what makes a health insurance product a must-have policy for every Indian family.

On November 06, 2016 by www.taxexcel.net

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Your expense of medical insurance can also give you the opportunity to save some more tax. Under section 80D of the income tax act, you can get the tax benefit for the insurance premium. Well, there are  other tax saving options under section 80C, But section 80D gives you additional tax benefit. You can get a tax deduction of up to Rs 65,000 under the section 80D. Like any other tax saving option, there are some limitations with section 80D.

Section 80D: Income Tax Saving Limit

You can claim a tax deduction of health insurance premium. You can claim a tax deduction for the premium payment of your family and parents separately. But it is subject to an upper limit.

Tax Saving On The Health Insurance Premium of Your Family

You can get a tax deduction of maximum Rs 25,000 on the health insurance premium for self and family. If you are a senior citizen, you can claim tax deduction on the premium of up to Rs 30,000.

Tax Saving On The Health Insurance Premium of Your Parents

In Addition to above you can further claim a tax deduction for the insurance premium of your parents. The maximum limit for this deduction is Rs 25,000. If the parents are a senior citizen, the maximum limit is 30,000. 

Section 80D: Preventive Health Check Up Tax Deduction

There is another tax benefit under section 80D. You can also claim a tax deduction for the expense of health check up. The maximum deduction allowed under this provision is 5,000. Health check up can be Section 80D: Who Is Eligible For Tax Benefit

Any taxpayer can avail the tax deduction under section 80D. The medical insurance premium can be of any or all of these family members.

·                                 Self

·                                 Wife/Husband

·                                 Dependent Children

·                                 Parents

The cumulative insurance premium payment of all the family members should not exceed the prescribed limit.

If An HUF is claiming a tax deduction under section 80D. It can add the insurance premium of any family member, subject to the maximum limit.

Maximum Tax Saving Because Of the Section 80D

Tax saving because of the section 80D is different to different situation. Have a look at the table.

				Health Check Up	Total Deduction
You and your family	25,00			5,000	30,000
You and your family	25,000	Parents	25,000	5,000	55,000
You and your family	25,000	Senior citizens Parents	30,000	5,000	60,000
You (Senior citizen) & Family	30,000	Senior citizen Parents	30,000	5,000	65,000

 

On November 22, 2015 by www.taxexcel.net

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Most of the Tax payers are known about the Income Tax Section 80C where you can relief Max Rs. 1.5 Lakh. And Common Tax Payers only follow this section 80C, and they always follow whether the limit extended or not, which deduction are include in this Section 80C. Most of the Tax Payers are look this Only this Section.

But As per the Income Tax Act 1961, you may get Income Tax Relief from your Source of Income Directly other than Section 80C. Below given a list of Income Tax Section were you can get Relief and this deduction will be reduce your Income Tax. The below given list is shown and follow the New Finance Budget 2015-16.  Budget 2015 has been introduced in Parliament. The Finance Minister has kept the Personal Income Tax rates unchanged for the Financial Year 2015 /2016 (Assessment Year 2016-2017).

Section 80CCD:- Employee can contribute to Government notified Pension Schemes (like National Pension Scheme – NPS). The contributions can be upto 10% of the salary (or) Gross Income and Rs 50,000 additional tax benefit u/s 80CCD (1b) is proposed in Budget 2015. In FY 2014-2015, the maximum tax exemption allowed under Section 80CCD is Rs 1 Lakh only. In Financial Year 2015-2016 or Assessment Year (2016-2017), this will be Rs 1.5 Lakh (u/s 80 CCD 1 ) and additional exemption of Rs 50,000 u/s 80CCD (1b) will be allowed. ( To claim this deduction, the employee has to contribute to Govt recognized Pension schemes like NPS)

(10% of salary is applicable for salaried individuals and Gross income is applicable for non-slaried. The definition of Salary is only ‘Dearness Allowance.’ If your employer also contributes to Pension Scheme, the whole contribution amount (10% of salary) can be claimed as tax deduction under Section 80CCD (2). The ceiling limit of 1.5 Lakh u/s 80CCD is not applicable on employer’s contribution.)

Section 80D Medical Insurance :-Deduction u/s 80D on health insurance premium will be Rs 25,000, increased from Rs 15000. For Senior Citizens it has been increased to Rs 30,000 from the existing Rs 20,000. For very senior citizen above the age of 80 years who are not eligible to take health insurance, deduction is allowed for Rs 30,000 toward medical expenditure.

Section 80DD :-You can claim up to Rs 75,000 (increased from the existing Rs 50,000) for spending on medical treatments of your dependents (spouse, parents, kids or siblings) who have 40% disability. It is also been proposed to increase the limit of deduction from Rs 1 lakh to Rs 1.25 lakh in case of severe disability.

Section 80DDB :- An individual (less than 60 years of age) can claim upto Rs 40,000 for the treatment of specified critical ailments. This can also be claimed on behalf of the dependents. The tax deduction limit under this section for Senior Citizens is proposed as Rs 60,000 and for very Senior Citizens (above 80 years) the limit is Rs 80,000

Section 24 (B):- House Building Loan Interest:- You can claim upto Rs 2 Lakh as tax deduction on the home loan interest payment. If your property is a let-out one then the entire interest amount can be claimed as tax deduction.

Section 80EE:- House Building Loan Interest :- You can get another Relief from the House Building Loan Interest U/s 80EE which was introduce in the Financial Year 2013-14 and this Section remain continue for forth comming financial Year. The Max Limit Rs. 1 Lakh and the this relief can get who are HB Interest Paid since 1/4/2013 and onwards.

Section 80U :- You can claim up to Rs 75,000 (increased from the existing Rs 50,000) who have 800% disability. It is also increase the limit of deduction from Rs 1 lakh to Rs 1.25 lakh in case of severe disability above 80 %

       Section 80 TTA :- This Section can get relief from Income Tax from the Savings Bank Interest             Max Rs.10,000/- who's taxable Income less than 5 lakh.

     Section 87A :- This Section can get Relief from Income Tax as Tax Rebate Max. Rs.2,000/- who's         Taxable Income Less than 5 Lakh.

     Section 10(13A) : House Rent Exemption  Max Rs. 50%,40% or 10% of Basic pay +                  D.A. + Spl allowances which ever is less [ Download HRA Exemption Calculator U/s 10(13A)

   Section 89(1) :- Arrears Relief from Income Tax, some of employees have received the             salary amount from his Previous Financial Year, which may break up and can get relief this       section and also he have to submit the Form 10e.[ Download the Arrears Relief Exemption       Calculator U/s 89(1) with Form 10E, Since 2000-01 to 2014-15 ]

On November 09, 2015 by www.taxexcel.net

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