Section 80D- Know the Deduction Limit under the Income Tax Act, 1961

Under Income Tax, after calculating Gross Total Income, certain deductions are allowed to the assessee which includes deduction under chapter VIA of the Income Tax Act. This includes deduction from section 80C to section 80U of the Act. In this article, we will discuss Section 80D of Income Tax Act.

Section 80D of Income Tax Act, 1961

Section 80D of Income Tax Act- This section contains the provision regarding the deduction on payment of medical insurance premium and health checkup from the gross total income of the assessee. It allows deduction on payment of premiums of medical insurance policy for the taxpayer himself and/or a family member as described under the section.

Section 80D deduction limit- Premium Payment

As mentioned before, Section 80D will help you in getting tax deduction from the income of the assessee. This section allowed a deduction to Individual and HUF assessee only. The deductions allowed are as follow-

Deduction limit for Individual (Self and family)

👉 Maximum deduction limit of Rs. 25,000 per year on health insurance premium paid for self and family.

👉 Maximum deduction of Rs. 50,000 per year if you are a senior citizen.

Deduction limit for Individual (Parents)

👉 Maximum deduction limit of Rs. 25,000 per year on health insurance premium paid on behalf of parents.

👉 Maximum deduction of Rs. 50,000 per year on premium payment for senior citizen parents.

Also Read- How to calculate interest under Section 234A, 234B, and 234C of Income Tax Act, 1961

Deduction limit for Hindu Undivided Family (HUF)

👉 For HUF, the maximum permissible amount of deduction is Rs. 25,000 as the premium paid on the health insurance scheme of any family member of HUF.

The allowed limit of Rs. 25,000 is further added to Rs. 50,000 in the following cases-

👉 Premium paid for senior citizen member.

👉 When medical expenditure is incurred on the health of a senior citizen person, provided no amount is paid in respect of the health insurance of such person.

Health Checkup Covered u/s 80D

If during the year assessee for himself and his family and/or for his parents, paid any amount for a health checkup then he will be eligible to get Rs. 5,000 as a deduction under section 80D of Income Tax Act. This deduction is subject to the maximum permissible amount as prescribed above.

Section 80D medical expenditure limit for deduction

Medical expenditure under section 80D of Income Tax Act is an allowable expense provided that, the assessee should be a senior citizen person and no amount should be paid in respect of his medical insurance. The medical expenses deduction limit under the income tax act are as follows.

For himself or his family member- The whole of the amount paid on account of medical expenditure incurred on the health of the assessee or his family member should not exceed Rs. 50,000.

For Parents- The whole of the amount paid on account of any medical expenditure incurred on the health of any parent should not exceed Rs. 50,000.

Also Read: Documents Required for ITR Filing- Income Tax Return Filing

Section 80D Eligibility

Individual and HUF assessee are only eligible to claim deduction under section 80D of Income Tax Act, 1961. The other eligibility is as follows.

Individual- A resident individual can avail the deduction, according to section 80D, against the premium paid for health insurance services for below family members.

  • Self
  • Children
  • Spouse
  • Parents

HUF- A Hindu Undivided Family can also claim tax deduction under section 80D of Income Tax Act. The premium payment should be towards the medical insurance of a HUF member-only and the tax deduction is allowed up to the maximum permitted limit as described above.

Also Read- Benefits of Filing ITR- File your ITR to get these benefits

Chart for deduction under section 80D of Income Tax Act

The following chart will show you all the eligible deduction under this section-

Covered assesseeExemption Limit***Health Check-upTotal Eligible Deduction
Self and FamilyRs. 25,000Rs. 5,000Rs. 25,000
Self and Family + ParentsRs. 50,000 (25000+25000)Rs. 5,000Rs. 50,000
Self and Family + Senior Citizen ParentsRs. 75,000 (25000+50000)Rs. 5,000Rs. 75,000
Self (Senior Citizen) and Family + Senior Citizen ParentsRs. 1,00,000 (50000+50000)Rs. 5,000Rs. 1,00,000

(***) Note- It covered the payment of medical insurance premium and central government health scheme.

Cash payment for Premium or Medical Checkup

If you are paying a medical insurance premium or incurred health check-up expenses in cash then you will not be eligible to claim deduction under section 80D of Income Tax Act.

The payment should be made through online banking, a cheque, draft, debit or credit card, etc.

But for preventive health check-ups, the payment can be made through any mode including cash.

Also Read- What is the Interest and Penalty for late filing of Income tax Return

Important points for section 80D

The following points are important to keep in mind while taking deduction under section 80D of Income Tax Act.

⚫ For the purpose of claiming medical expenditure and medical premium, the total deduction should not be exceeded Rs. 50,000.

⚫ Contribution towards health insurance plan has to be made to a scheme as specified by the Central Government approved by IRDA.

⚫ Premium paid towards a brother, sister, grandparents, aunts, uncle or any other relatives cannot be claimed as a deduction for taking tax benefits.

⚫ Premium paid on behalf of working children can not be taken for the tax benefit.

⚫ The deduction has to be claimed without showing the GST and other taxes.

⚫ Group Health Insurance Premium provided by the company is not eligible for deduction.

Frequently Asked Questions- FAQs

  1. What can be claimed under 80D?

    Individual and HUF assessee are only eligible to claim deduction under section 80D of the Income Tax Act, 1961. The other eligibility is as follows.

    Individual- A resident individual can avail the deduction, according to section 80D, against the premium paid for health insurance services for below family members.
    Self
    Children
    Spouse
    Parents
    HUF- A Hindu Undivided Family can also claim tax deduction under section 80D of Income Tax Act. The premium payment should be towards the medical insurance of a HUF member-only and the tax deduction is allowed up to the maximum permitted limit as described above.

  2. Can medicine bills be claimed under 80D?

    Section 80d contains the provision regarding the deduction on payment of medical insurance premium, central government health scheme, and payment on account of preventive health checkups,

  3. Is proof required for 80D?

    There is no requirement for submitting proof of payment to the Income Tax Department but safe aside you can keep a copy and other details of it for future reference.

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Disclaimer: The information contained in the above article are solely for informational purpose after exercising due care. However, it does not constitute professional advice or a formal recommendation. The author does not own any responsibility for any loss or damage caused to any person, directly or indirectly, for any action taken on the basis of the above article.

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Compiled by- CA Chirag Agarwal (Practicing Chartered Accountants)

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