Section 80 d related explanations

SECTION 80 D DEDUCTION REGARDING MEDICAL INSURANCE PREMIUM/ PREVENTIVE HEALTH CHECKUP PAYMENTS.

1)OVERVIEW:

• Deduction under section 80 D is available for payment of medical insurance premium paid for Individuals, HUF and their members.
• Now benefit is also available for expenditure incurred for preventive Health Check-up .

2)AVAILABLE TO:

• For Individual,  HUF (Hindu Undivided Family)
• Whether Resident or Non- Resident.

3)ON LIFE OF:

• Individual himself / herself
• Spouse of Individual
• Children (Dependent)

• Parents (Dependent or not)

Note:

• Expenditure incurred on Preventive Health Check-Up  of Parent is allowable only for dependent parents only.

4)MODE OF PAYMENT:

• Payment must be through any mode other than cash i.e deduction is not available if medical insurance premium is paid in cash.
• So pay medical insurance premium only through Cheque/ Net banking / Credit Card.

However preventive health check-up expenditure can be incurred in cash.

Note:

• Such payment must be out of taxable income of assessee.

5)AMOUNT OF DEDUCTION:

a)For policy taken for Assessee, Spouse and dependent children

• Medical Insurance Premium paid or INR 15000/- Whichever is less.

Note:

• A sum of Rs. 5000/- is also available on account expenditure incurred on preventive health checkup but this is subject to maximum limit of  INR 15000/- as aforementioned.  

b)For policy taken for Parents whether dependent or not.

• Medical Insurance Premium paid or INR 15000/- (20000 if either parent is senior citizen)  Whichever is less.

Note:

• If one has paid medical insurance premium for their family as well as for parents than one can claim deduction for both.
• Senior citizen means a person who attain age of 60 year at any time during previous year.
• A sum of Rs. 5000/- is also available on account expenditure incurred on preventive health checkup but this is subject to maximum of INR 15000/-or 20000/- as aforementioned. 

6)EXAMPLE:

1. An individual assessee pay INR 12500/- medical insurance premium for their family and INR 21000 for their parents than:

1. A deduction of INR 27500/- (12500+15000) is available if their parents is not in category of senior citizens. OR
2. A deduction of INR 32500/- (12500+20000) is available if their parents is in category of senior citizens.