Group medi-claim benefit in income tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 November 2015 Hi

We are recovering the Group Medi-Claim amount from the employees' salary. Can employee claim the same under 80 D for tax benefit ?

Thanks in advance ! !

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
Follow

04 November 2015 Yes, employee can very well claim 80D.

Querist : Anonymous

Querist : Anonymous (Querist)

26 December 2015 Hi

Can Anyone please provide a relevant supporting regarding this from Act ?

Thanks in advance ! !

Asha Kanta Sharma online

Asha Kanta Sharma online

(Expert)
Follow

26 July 2024 Under the Income Tax Act of India, an employee can claim a deduction under **Section 80D** for premiums paid on health insurance policies. However, the specifics of how the deduction works when the employer recovers the premium amount from the employee's salary can be nuanced.

### **Relevant Section: Section 80D**

**Section 80D** allows a deduction for premiums paid on health insurance policies for self, spouse, children, and parents. The key points under this section are:

1. **For Self and Family:** A maximum deduction of ₹25,000 (or ₹50,000 for senior citizens) can be claimed for premiums paid for health insurance policies for self, spouse, and dependent children.

2. **For Parents:** An additional deduction of ₹25,000 (or ₹50,000 for senior citizens) can be claimed for premiums paid for health insurance policies for parents.

### **Impact of Employer Recovery**

1. **Direct Payment by Employee:** If the employee pays the premium amount directly to the insurance company, they can claim the deduction under Section 80D. This is straightforward and typically requires the employee to have proof of payment, such as receipts or policy documents.

2. **Recovery from Salary:** If the employer recovers the health insurance premium from the employee’s salary and pays it directly to the insurance company, the employee can still claim the deduction under Section 80D. The crucial factor is that the payment must be made for a qualifying health insurance policy.

- **Documentation:** The employee should ensure they receive a certificate or proof from the employer confirming the payment of the premium and the policy details. This proof will be necessary to claim the deduction.

- **Income Tax Filing:** When claiming the deduction, the employee should ensure the amount recovered from the salary is reflected accurately in their tax return, considering any documentation or proof provided by the employer.

### **Supporting Provision from Act:**

The **Income Tax Act, 1961**, in **Section 80D**, outlines the eligibility for claiming deductions for premiums paid on health insurance. Specifically, the act does not stipulate how the premium should be paid but focuses on the purpose and beneficiary of the premium.

### **Relevant Points:**

- **Section 80D(2):** The deduction is allowed to the taxpayer for premiums paid for health insurance policies for self, spouse, children, and parents. It does not differentiate based on who makes the payment.

- **Tax Benefits:** The deduction can be claimed irrespective of the mode of payment as long as the payment is for a qualifying health insurance policy.

### **Conclusion:**

Yes, an employee can claim a deduction under **Section 80D** even if the health insurance premium is recovered from their salary by the employer. The key is to ensure proper documentation and proof of payment are maintained.

For specific details or any changes to the law, always refer to the latest Finance Act or consult with a tax advisor.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now