Section 80D: How it works & helps save money
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Personal Finance
- Swati Tripathi
- 2022-12-10
- 03 min read
#80D income tax act
#section 80D

The Section 80D of the Income Tax Act of 1961 allows eligible taxpayers to claim tax credits for the cost of maintaining health and medical insurance, playing an essential role in tax planning and personal finances.

In addition to regular health insurance premiums, it can also be used for premiums for top-up plans and critical illness plans. Along with this, you may be eligible for Section 80D deductions on premiums you pay to purchase health insurance for yourself, your spouse, dependent children and parents.

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What deductions are allowed under the 80D?

• Money used for health insurance premiums

• Money spent on family health care, including parents

Money spent to maintain health insurance may be charged under Section 80D. However, there is a limit depending on the insured person's age.

Criteria and maximum deductions

Section 80D allows you a deduction of Rs 25,000 for yourself, your spouse and your dependent children. However, it depends on the age of the parents. Suppose you are over 60, i.e. Elderly; the maximum tax credit is ₹75,000. However, if you are under 60, his maximum deductible is INR 50,000. A full deduction of Rs.1,00,000 may be claimed for taxpayers, spouses and parents who fall under the advanced classification.

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Parents over 80

Section 80D of the Income Tax Act also includes provisions for super seniors over 80. Under Income Tax Section 80D, super seniors who do not have medical insurance can also claim a deduction amount of up to Rs 50,000 per fiscal year for medical examination and treatment. However, her 80D deduction does not apply to her expenses.

Let's understand it with an example. Suppose you are 60 years old and are paying health insurance premiums of Rs 30,000 a year for your dependents and yourself. I will also pay a premium of 35,000 rupees for the health insurance of my parents, who are 80 years old and very elderly. Therefore, according to Section 80D of the Income Tax Act, the following benefits can be claimed:

·         Rs 30,000 tax benefit on Rs 30,000 health insurance premiums paid for your dependents and yourself.

·         35,000 rupees tax incentive for medical expenses and 35,000 rupees health check for elderly parents.

·         A total tax credit of Rs 65,000 can be claimed under Section 80D of the Income Tax Act, 1961.

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Section 80 DDB deduction (treatment of certain diseases)

You can also claim a tax credit of less than 80 DDB for medical expenses to treat certain illnesses. Under 60, you are entitled to a deduction of up to Rs 40,000 per fiscal year for certain medical expenses. However, the section 80D medical expense deduction limit for seniors and super seniors is Rs.

Cancer, chronic renal failure, Parkinson's disease, and AIDS are some diseases for which treatment costs are tax deductible under Section 80DDB. See Rule 11DD for a complete list of these diseases. You, your spouse, parents, children, and siblings may be billed for these medical expenses.

However, when filing income tax returns, it is necessary to enclose a confirmation letter from a specialist that proves that you are receiving treatment for a specific disease.

Income Tax Act Article 80 DD Deduction (Treatment of dependents with disabilities)

Under Section 80DD, you may receive a tax credit for medical expenses related to treating a loved one with a disability. This includes medical expenses incurred in the care, education, treatment, maintenance and rehabilitation of loved ones with some degree of disability. Dependents can be parents, children, spouses or siblings.

Each fiscal year, up to Rs.75,000 for treatment of a disabled dependent if her disability is 40% or more, she claims a tax benefit of Rs.1.25 lakh if ​​her severe disability is 70% or more of her I can do it. However, when filing income tax returns, it is necessary to submit a medical certificate that proves the disability. Ensure that your government's central or state medical board has issued your medical certificate.

Section 80U Deduction (Disabled)

Section 80U of the Income Tax Act provides for deductions for people with disabilities. Under this section, persons with disabilities at least 40 years of age are entitled to tax benefits of Rs 75,000 per financial year. However, if the disability is 80% or more of her, the deductible limit increases to Rs 1.25 lakh per financial year. It has nothing to do with medical expenses. Deduction from reimbursement/benefits for medical services under Section 17 of the Income Tax Act

According to Section 17 of the Income Tax Law, all medical expenses paid by an employer for the treatment of family members or themselves can be deducted. As a result, income tax up to Rs 40,000 per fiscal year on amounts paid by your employer as part of your salary for treatment of illness affecting your family members (self, spouse, children, siblings, dependents) is exempt. Year. This deductible limit replaces both a flat rate for medical expenses and a flat rate for travel expenses.

However, the amount paid by the employer as sickness allowance for medical expenses for family members (the principal, spouse, children, dependents, siblings) is not eligible for tax incentives and is fully taxable.

Section 80D Health Examination

The government encourages citizens to be health conscious and work towards a better lifestyle. To promote this initiative, they introduced a preventive health check exemption in 2013-2014. This encouraged the early reduction of risk factors by detecting the disease and seeing a doctor regularly.

For example, an individual can claim her Rs 5,000 preventive medical examination deduction under Section 80D. This amount can be claimed against the principal, spouse, dependent children or parents up to Rs 25,000 for an individual and Rs 50,000 for an elderly person. There is also a discount for cash payments for medical examinations. However, cash payments are not tax deductible.

Notably, only non-cash health insurance premiums are eligible for the Section 80D Income Tax Code deduction.

To be eligible for the Section 80D income tax deduction, you must pay your health insurance premiums in non-cash. Premiums can be paid by online banking, check direct debit, credit card, etc. There are no Section 80D deductions if prizes are paid in cash.

However, this requirement does not apply to medical examination refunds under the Income Tax Act. You can also request a medical examination for tax purposes if payment is made in cash.

80D Additional Deduction

Another reason why this health insurance is compulsory is that it allows a tax deduction of Rs 5,000 for expenses related to medical examinations for the whole family.

Exemptions under Section 80D of the Income Tax Act

There are several reasons why Section 80D is not responsible.

-          Type of premium payment

To receive Section 80D tax benefits, only taxpayers must pay health insurance premiums. If a third party pays the premium, the taxpayer is not entitled to her u/s 80D deduction. Also, if the premium is paid in cash, the taxpayer is not entitled to any tax incentives.

-          Service tax

Taxpayers are not required to receive tax incentives for service tax and customs duties imposed on premium payments. For ordinary citizens, the service tax is levied on health insurance premiums and is payable at 14% of the health insurance premium.

-          Group health insurance

Group health insurance does not provide tax benefits under section 80D of the Income Tax Act. However, if the taxpayer chooses to increase the group's protection by paying an additional premium, he can claim a deduction for the additional amount under section 80D.

In conclusion, investing in health insurance is also important. This is mainly due to the dual benefits of tax incentives and medical expense coverage. Please do your research online and choose the policy that best suits your family and your needs. So, invest responsibly and wisely.


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