Personal care policy u/s 80c or u/s 80d

This query is : Resolved

Lalit Madaan (Querist)
Follow

23 February 2012 Personal Care Policy (for Permanent Disability / Death)is covered under which section for deduction under Income Tax Act.

Please advise.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
Follow

23 February 2012 Life Insurance Policies covering the life are covered U/s 80C.
.
Medi-claim Policy or health insurance is covered U/s 80D.
.
For permanent Disability of a dependant, if any premium is paid by the assessee, it is covered U/s 80DD.
.

Lalit Madaan

Lalit Madaan (Querist)
Follow

23 February 2012 Dear Paras,

Thanks for quick response.

I would like to draw you kind attention on Term Plan only which is being taken by Individual for his own Accidental/Permanent Disability.

amount paid for such policy will covered under which section.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
Follow

10 August 2024 Under the Income Tax Act, the treatment of premiums paid for personal care policies, including those for permanent disability or death, is generally covered under specific sections depending on the nature of the policy. Here’s how these policies are treated:

### **1. Section 80C:**

- **Section 80C** provides deductions for investments and payments made towards certain specified financial instruments. This includes:
- Life insurance premiums
- Equity-linked savings schemes (ELSS)
- Public Provident Fund (PPF)
- National Savings Certificates (NSC), and other similar investments.

**Personal Care Policies (like Term Plans)**:
- If you are paying premiums for a life insurance policy (including term plans) that provides coverage for death or permanent disability, the premium qualifies for a deduction under **Section 80C**.
- The deduction is limited to a maximum of ₹1.5 lakh in a financial year.

### **2. Section 80D:**

- **Section 80D** covers deductions for premiums paid on health insurance policies and preventive health check-ups.

**Health Insurance Policies**:
- Premiums paid for health insurance policies (including policies covering critical illness and disability due to illness) are eligible for deduction under **Section 80D**.
- This includes premiums paid for:
- Health insurance for self, spouse, children, and parents.
- Preventive health check-ups.

**Personal Care Policies (Accidental/Permanent Disability)**:
- If the policy covers accidental disability, it does not fall under **Section 80D** unless it is part of a health insurance policy that covers such risks.
- For standalone personal care policies or term plans specifically for accidental or permanent disability, **Section 80C** is the applicable section for claiming a deduction.

### **Key Points:**

- **For Term Insurance and Life Insurance Policies**: Premiums paid are deductible under **Section 80C**.
- **For Health Insurance**: Premiums are deductible under **Section 80D**.

### **Example:**

- If you have purchased a term insurance policy or a life insurance policy with coverage for permanent disability, you can claim a deduction of the premiums paid under **Section 80C** up to ₹1.5 lakh.
- If you have a health insurance policy that includes coverage for accidental disability, the premium can be claimed under **Section 80D**.

### **Summary:**

- **Term Plans** (life insurance) are covered under **Section 80C**.
- **Health Insurance Policies** (if they include coverage for accidental disability) can be covered under **Section 80D**.

For any specific scenarios or policies, it's always a good idea to consult a tax advisor or financial planner to ensure compliance with current tax laws and to maximize your eligible deductions.

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

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok