Section 80D – Income Tax Deduction for Medical Insurance and Health Checkup

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An Overview of Section 80D of Income Tax Act

Section 80D of Income Tax Act provides tax deduction from the total taxable income of the individual or HUF for any medical insurance premium paid.

Amount of Deduction
The amount of deduction that can be claimed under Section 80D is the total of the following:
  1. When the medical insurance premium is paid by the assesse for himself, spouse or dependent children, the amount of allowed deduction is Rs. 25000. In case of senior citizen, the deduction allowed is Rs. 30000.
  2. When the payment of medical insurance premium is paid by assesse for parents, the amount of deduction allowed is Rs. 25000. In cases where the parents of assessee are senior citizens, the deduction allowed is Rs. 50000.

Maximum Deductions Allowed under Section 80D are:

Medical Insurance
Exemption limit
Total Deduction
For self and family
Rs. 25000
Rs. 25000
For self and family including parents
Rs. 25000 + Rs. 25000
Rs. 50000
For self and family including parents who are senior citizens
Rs. 25000 + Rs. 50000
Rs. 75000
For self (above 60 years of age) and family including senior citizen parents
Rs. 50000 + Rs. 50000
Rs. 100000
  
Thus, the maximum permissible deduction is Rs. 25000 every financial year and for senior citizens, the deduction is Rs. 50000 per financial year. When both assessee and parents are senior citizens, the deduction allowed is Rs. 100000.

section 80d


Example

Let’s understand this deduction under Section 80D with the help of an example. Let’s suppose Mr. Gaurav is a salaried individual with an annual income of Rs. 600000. He has paid medical insurance premium for himself and his family with annual premium of Rs. 35000. He is also paying premium of Rs. 30000 for health insurance of his father who is 82 years old. Now, let’s calculate maximum tax exemption amount under Section 80D:
Gaurav can avail tax deduction of Rs. 25000 out of Rs.35000 premium paid towards medical insurance for himself and his family.
In addition, he can also claim full amount of Rs. 35000 for premium paid for his father who is super senior citizen. Thus, the total amount of tax deduction he can claim is Rs. 25000 + Rs. 35000 = Rs. 60000.

Deduction under Section 80D for Super Senior Citizens
Super Senior Citizens are those who are above the age of 80 years. The total deduction allowed for super senior citizens for payment of medical insurance premium and medical expenses is Rs. 30000. This limit has now been enhanced to Rs. 50000 with effect from Financial Year 2018-19.

Preventive Health Checkup Deduction
A new deduction of Rs. 5000 has been allowed under Section 80D for payment of preventive health-checkup of himself or his family members including parents and dependent children. This deduction of Rs. 5000 is not in addition to the deductions stated above.

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