Section 80D of the Income tax act, 1961, allows an individual and HUF to claim deduction out of income in respect of medical and health insurance premium.
As per Section 80D, an individual irrespective of citizenship and residential status can take benefits of this section. Which means both Indian citizens and foreign citizens can claim section 80D tax deduction.
NRIs are also eligible.
To claim section 80D tax deduction, the taxpayer has to satisfy all the conditions of tax laws.
Here are the most important conditions specified under section 80D you must look at before calculating your deduction amount;
- Taxpayers must be an Individual or HUF.
- Payment should be made out of income chargeable to tax.
- Payment should be made by any mode other than cash. Only payment for preventive health check up is allowed to be made by any mode including cash.
You can claim tax deduction under section 80D over and above the deduction claimed under section 80C.
Amount of tax deduction under section 80D in income tax
Tax deduction under section 80D can be divided into following three parts based on the provisions.
When medical insurance is for the health of the assessee or his family
Medical insurance premium paid to effect or to keep in force an insurance on the health of the assessee or his family is eligible for tax deduction under section 80D up to a limit of 25,000 rupees.
The assessee is also eligible for tax deduction when any contribution is made to the Central Government Health Scheme or such other scheme as may be notified by the Central Government in this behalf to effect or to keep in force an insurance on the health of the assessee or his family.
If medical insurance is paid to effect or keep in force an insurance on the health of self or family member, who is a senior citizen, then the total amount of tax deduction should not exceed 50,000 rupees in aggregate. Which means, additional tax deduction of 25,000 rupees can be claimed along with above limits.
Family for the purpose of section 80D includes individual, spouse of the individual and dependent children.
When medical insurance is for the health of the parents
If the medical insurance premium is paid for the benefits of parents of the assessee, then additional tax deduction up to a limit of 25,000 rupees is allowed. Parents include the father and mother of the taxpayer.
Please note, if health insurance is for the benefit of mother-in-law or father-in-laws then tax deduction will not be allowed under section 80D of the income tax act, 1961.
If health insurance is paid on the life of a parent who is a senior citizen, then instead of 25,000 rupees, up to an aggregate amount of 50,000 rupees will be allowed as tax deduction. Which means, additional tax deduction of 25,000 rupees can be claimed in this case.
Senior citizen means an individual resident in India who is of the age of 60 years or more at any time during the relevant previous year.
If you have paid a single premium towards your health insurance policies having cover of more than one year, then section 80D tax deduction shall be allowed on proportionate basis for the number of years for which health insurance cover is provided.
Amount of tax deduction for preventive health checkup
Preventive health check-up is not defined in income tax. By general definition, preventive health check-up means frequent medical examination conducted to identify an illness at an early stage to reduce risk.
Tax deduction for payment of preventive health checkup should not exceed 5,000 rupees per annum. This benefit is available only if payment on account of preventive health check-up is made for self, spouse, dependent children, father and mother.
You will be allowed tax deduction irrespective of the mode of payment. If you have paid in cash, then also tax deduction up to 5,000 rupees can be claimed under section 80D of the Income tax act, 1961.
Please note, 5,000 rupees income tax deduction for preventive health check-up is within the overall limit as specified above based on your eligibility.
Below table shows the amount of tax deduction available to an Individual taxpayer
Amounts in INR
| Health insurance premium payment made for the benefits of | Maximum tax deduction for Self and Family | Maximum tax deduction for Parents | Maximum tax deduction for Preventive check-up | Maximum Tax Deduction under section 80DDB |
| Self & Family(who is below 60 years of age) | 25,000 | – | 5,000 | 25,000 |
| Self & Family + Parents(all of them below 60 years) | 25,000 | 25,000 | 5,000 | 50,000 |
| Self & Family (below 60 years)+ Parents (above 60 years) | 25,000 | 50,000 | 5,000 | 75,000 |
| Self & Family + Parents(above 60 years) | 50,000 | 50,000 | 5,000 | 1,00,000 |
Table showing tax deduction limit under section 80D for a HUF
Amounts in INR
| Health insurance premium payment made for the benefits of | Maximum tax deduction for a member below 60 years | Maximum tax deduction for a senior citizen | Maximum tax deduction for Preventive check-up | Maximum Tax Deduction under section 80DDB |
| any members of HUF(below 60 years) | 25,000 | 50,000 | NIL | 50,000 |
Tax deduction for medical expenditure under section 80D
Medical expenditure on account of health of the assessee or any member of his family who is a senior citizen can be claimed as tax deduction under section 80D of the income tax act, 1961 up to an amount of 50,000 rupees provided medical insurance premium is not paid on the health of such person.
Similarly, the whole of the amount paid on account of medical expenditure incurred on the health of any parent of the assessee, who is a senior citizen can be claimed as income tax deduction up to an amount of 50,000 rupees.
Senior citizen is a resident individual who is at least 60 years of age at any time during the financial year for which you are claiming the tax deduction.
Please note, total income tax deduction under section 80D including medical insurance premium, preventive health check-up and medical expenditure for self or family can not exceed 50,000 rupees for a financial year. Similarly, total tax deduction under section 80D for parents of the taxpayer is limited to 50,000 rupees for the financial year.
Example
Suppose 35 year old Hritik has purchased health insurance for a premium of 32,000 rupees for the financial year 2023-24. As per section 80D, Hritik can claim a tax deduction of 25,000 for the financial year 2023-24 (assessment year 2024-25) as he is not a senior citizen. But Hritik’s father, who is 62 years old, paid 65,000 as medical insurance. In this case, his father can claim a income tax deduction of 50,000 rupees as he is a senior citizen.
Suppose Hritik has purchased a health insurance policy of 54,000 for his elderly parents, aged 63 years and 55 years during the financial year 2023-24 (assessment year 2024-25). In this case, Hritk can claim a income tax deduction of 50,000 on the health insurance premium paid as one of his parents is a senior citizen.
Suppose Akshy Kumar has a family of 4 members, i.e. self (45 years), wife (38 years), one child (10 years), father (65 years), and mother (56 years). Mr Akshy kumar has purchased a family floater health insurance plan that covers himself, wife and one child for a yearly premium of 28,000. He also paid 51,000 rupees for parent’s medical insurance. Besides, Akshy has also paid 12,000 rupees for his health check-up and 8,000 rupees for his parent’s health check-up. Here is the table showing how the calculation is done for Akshy’s income tax deduction under section 80D of the Income tax act, 1961.
Amounts in INR
| Actual amount paid | Maximum tax deduction under section 80D | Actual amount allowed as tax deduction under section 80D | |
| Health insurance premium paid for self, wife and one dependent child | 28,000 | 25,000 | 25,000 |
| Preventive health check-up for self | 12,000 | 5,000 | 5,000 |
| Total for self, spouse and dependent child | 40,000 | 25,000 | 25,000 |
| Health insurance premium paid for his parents (who is a senior citizen) | 51,000 | 50,000 | 50,000 |
| Preventive health check-up for parents( who is a senior citizen) | 8,000 | 5,000 | 5,000 |
| Total for parents (senior citizen) | 59,000 | 50,000 | 50,000 |
| Total Deduction available to Akshy under section 80D | 75,000 |
When you can’t claim income tax deduction under section 80D?
If you have paid health insurance premium in cash, then section 80D tax deduction will not be available.
Only individuals and HUFs are allowed to take benefits of section 80D. In the case of individuals only health insurance premium paid for self, spouse, dependent children and parents are allowed. For HUFs all health insurance for all or any member is allowed.
You will not be able to claim tax deduction under section 80D if you have opted to pay tax as per the new income tax regime as per section 115BAC.You can claim this income tax deduction only if you opt for the old tax regime in a financial year.
Group health insurance premium paid by the company on behalf of the employee is not eligible as income tax deduction under section 80D.
How do I claim tax benefits under section 80D?
You can claim tax deduction under section 80D by filing your income tax return with the government. You need to fill up the exact eligible amount while filing your ITR.
You are not required to attach or submit any kind of proof while filing your IT return. However, it’s suggested to keep all these documents in order to submit it before the assessing officer, if required in future.
Frequently asked questions (FAQs)
What investment comes under section 80D?
You can claim following three types of investments under section 80D;
- Money spent as premium for health insurance policy
- Money spent on preventive health check-up
- Medical expenses incurred for senior citizen if health insurance is not taken
What is the mode of payment under section 80D?
In order to claim tax deduction under section 80D of the Income tax act, 1961, the taxpayer must obey the mode of payment as specified under this section. Cash payment is only allowed in the case of preventive health check-up. In all other cases, you need to pay through the bank or in any mode other than cash.
| Purpose of payment | Mode of payment |
| Preventive health check-up | Any mode including cash |
| All other cases (except preventive health check-up) | Any mode of payment other than cash (Cash payments not allowed as income tax deduction) |
What is the maximum limit of tax deduction for health insurance under section 80D?
Section 80D of the Income tax act, 1961, allows an individual to claim a maximum tax deduction of 25,000 rupees for health insurance premiums if it is paid for self, spouse and dependent children, when none of them are a senior citizen.
In addition to the above, if a health insurance premium is paid for parents, then a maximum income tax deduction of 50,000 rupees is allowed.
In case parents are senior citizens, then the maximum tax deduction limit is 75,000 rupees i.e. 25,000 for self and family, and 50,000 for parents being a senior citizen.
If any one or all of your family members are senior citizens and your parents are also senior citizens, then 1,00,000 can be claimed as a maximum income tax deduction under section 80D for paying health insurance premium.
| Medical insurance premium paid for | Maximum tax deduction allowed under Section 80D |
| the taxpayer, family members and parents who are below 60 years of age | 50,000 rupees |
| the taxpayer and family members who are below 60 years of age but parents are senior citizens | 75,000 rupees |
| the taxpayer and family, when all or any of them is a senior citizen and parents are senior citizens | 1,00,000 rupees |
How much tax can I save under Section 80D?
It depends on your income tax slab in which you are taxable in India.
If your income after tax deduction of 25,000 rupees under section 80D is 5,00,000, then tax saved by you is 5,200 rupees (20% saved on 25,000 rupees as tax deduction).
When your income is between 5,00,000 to 10,00,000 rupees for the financial year 2023-24 (assessment year 2024-25), then the amount of tax saved by you on a tax deduction of 25,000 rupees under section 80D will be 5,200 rupees. It is calculated at a tax rate of 20% saved by you due to 25,000 rupees tax deduction plus education cess at the rate of 4% applicable for the financial year 2023-24 (assessment year 2024-25).
Similarly, if your income is above 10,00,000, which falls under the higher tax rate of 30%, the tax saved by you for a tax deduction of 25,000 rupees under section 80D would be 7,800, including cess.
Can I claim a deduction for group health insurance paid by my employer?
No, as per section 80D, you can claim tax deduction only if it’s paid by you.
You can not claim tax deduction in this case as it’s paid by your employer. You can take the benefits only if the premium is paid by you subject to other conditions of this section.
Can I claim medical expenses without proof for 80D?
You can claim tax deduction without proof as it’s not required to be submitted at the time of filing income tax return. However you should keep these things with yourself as you should submit them before the assessing officer in future if it’s asked by the department.
Does GST paid on health insurance premium can be claimed as tax deduction under section 80D?
Yes, the whole amount including GST paid on health insurance can be claimed as tax deduction under section 80D.
Can I claim both section 80D and 80DD benefits?
Yes, you can claim tax deduction under both sections if you satisfy conditions specified under these sections.
Can I claim medical bills as tax deduction under section 80D?
Yes, you can claim medical bills as tax deduction only if it’s paid for senior citizen parents and they do not have health insurance.
I have paid my health insurance premium in cash. Can I claim tax benefits?
No, tax benefits are allowed only if it’s paid in any mode other than cash. In this case, you can not claim tax benefits on your payments for health insurance premium.
