Income Tax
Deduction under Section 80D in respect of health insurance premium for covering
the health of self, spouse, dependent children and parents
Deduction eligibility in respect of Health Insurance Premium
and health checkup charges paid from the income of the
tax payer under Section 80D has been increased to Rs. 25,000 from the last year eligibility of Rs. 15,000. This deduction cap or
Rs. 25,000 will be applicable for Medical Insurance premium paid for
the health of self, spouse and dependent children.
As far as
Health Insurance Premium paid by the tax payer to cover the medical expenses of
his/her parents, yearly premium and health check-up cost paid up to Rs. 25,000
can be deducted from the income. Also in the case of senior parents health
insurance premium up to Rs. 30,000 can be deducted.
In the case
of sharing of premium payment for covering the health of Parents, the actual
premium paid by each person can be deducted from his/her income.
Further,
medical expenditure incurred for very Senior Citizen up to Rs. 30,000 can be
deducted from the income of the person who has spent the same, provided the
said very senior citizen has no insurance coverage.
Deduction in respect of health insurance premia.
80D. (1)
In computing the total income of an assessee, being an individual or a Hindu
undivided family, there shall be deducted such sum, as specified in sub-section
(2) or sub-section (3), payment of which is made by any mode as specified in
sub-section (2B), in the previous year out of his income chargeable to tax.
(2)
Where the assessee is an individual, the sum referred to in sub-section (1)
shall be the aggregate of the following, namely:—
(a)
the whole of the amount paid to effect or to keep in force an insurance on the
health of the assessee or his family or any contribution made to the Central
Government Health Scheme [or such other scheme as may be notified by the
Central Government in this behalf] or any payment made on account of preventive
health check-up of the assessee or his family as does not exceed in the
aggregate [Twenty Five] thousand rupees; and
(b)
the whole of the amount paid to effect or to keep in force an insurance on the
health of the parent or parents of the assessee or any payment made on account
of preventive health check-up of the parent or parents of the assessee as does
not exceed in the aggregate [Twenty five] thousand rupees.
Following
clauses (c) and (d) shall be inserted after clause (b) of sub-section (2) of
section 80D by the Finance Act, 2015, w.e.f. 1-4-2016 :
(c)
the whole of the amount paid on account of medical expenditure incurred on the
health of the assessee or any member of his family as does not exceed in the
aggregate thirty thousand rupees; and
(d)
the whole of the amount paid on account of medical expenditure incurred on the
health of any parent of the assessee, as does not exceed in the aggregate
thirty thousand rupees:
Provided that
the amount referred to in clause (c) or clause (d) is paid in respect of a very
senior citizen and no amount has been paid to effect or to keep in force an
insurance on the health of such person:
Provided
further that the aggregate of the sum specified under clause (a) and
clause (c) or the aggregate of the sum specified under clause (b) and
clause (d) shall not exceed thirty thousand rupees.
Explanation.—For
the purposes of clause (a), “family” means the spouse and dependant children of
the assessee.
(2A)
Where the amounts referred to in clauses (a) and (b) of sub-section (2) are
paid on account of preventive health check-up, the deduction for such amounts
shall be allowed to the extent it does not exceed in the aggregate five
thousand rupees.
(2B)
For the purposes of deduction under sub-section (1), the payment shall be made
by—
(i) any mode, including cash, in respect of any
sum paid on account of preventive health check-up;
(ii) any mode other than cash in all other cases not falling under clause (i).
Following sub-section (3) shall be substituted for the existing
sub-section (3) of section 80D by the Finance Act, 2015, w.e.f. 1-4-2016 :
(3) Where the assessee is a Hindu undivided family, the sum
referred to in sub-section (1), shall be the aggregate of the following,
namely:—
(a)
whole of the amount paid to effect or to keep in force an insurance on the
health of any member of that Hindu undivided family as does not exceed in the
aggregate twenty-five thousand rupees; and
(b)
the whole of the amount paid on account of medical expenditure incurred on the
health of any member of the Hindu undivided family as does not exceed in the
aggregate thirty thousand rupees:
Provided that the amount referred to in
clause (b) is
paid in respect of a very senior citizen and no amount has been paid to effect
or to keep in force an insurance on the health of such person:
Provided further that
the aggregate of the sum specified under clause (a) and clause (b) shall not exceed thirty thousand rupees.
(4) Where the sum specified in clause
(a) or clause (b) of sub-section (2) [or
in sub-section (3)] is paid to effect or keep in force an
insurance on the health of any person specified therein, and who is a senior
citizen, [or a very senior citizen], the
provisions of this section shall have effect as if for the words” [Twenty Five] thousand rupees”, the words ” [Thirty] thousand
rupees” had been substituted.
[Explanation.—For
the purposes of this sub-section, “senior citizen” means an individual resident
in India who is of the age of sixty years or
more at any time during the relevant previous year.]
(5) The
insurance referred to in this section shall be in accordance with a scheme made
in this behalf by—
(a) the General Insurance Corporation of India
formed under section 9 of the General Insurance Business (Nationalisation) Act,
1972 (57 of 1972) and approved by the Central Government in this behalf; or
(b) any other insurer and approved by the
Insurance Regulatory and Development Authority established under sub-section
(1) of section 3 of the Insurance Regulatory and Development Authority Act,
1999 (41 of 1999).
Following Explanation shall be inserted to section
80D by the Finance Act, 2015, w.e.f. 1-4-2016 :
Explanation.—For the purposes of this
section,—
(i)
“senior citizen” means an individual resident in India who is of the age of sixty
years or more at any time during the relevant previous year;
(ii)
“very senior citizen” means an individual resident in India who is of
the age of eighty years or more at any time during the relevant previous year.
