Medical Insurance Premium paid for self, spouse, Children and dependents parents is allowed as exemption. This exemption is available under section 80D of Income Tax Act.
Health insurance, popularly known as Mediclaim Policies, provides a deduction of upto Rs. 35,000.00 ( valid till financial year 2014-2015, Assessment Year 2015-2016, )
1) – Rs. 15,000.00 for premium payments towards policies on self, spouse and children.
2 (a) Rs. 15,000.00 for premium payment towards non-Senior citizen dependent parents or
2 (b) Rs. 20,000.00 for premium payment towards Senior citizen dependent.
This deduction is in addition to Rs. 1,50,000 savings under IT deductions section 80C.
From Financial year 2015-2016 (Assessment year 2016-2017) Budget 2015 has increased Limit of medical insurance limit –
- Deduction under section 80D is raised from Rs 15,000 to Rs 25,000 for Non-Senior citizen category.
- The deduction for senior citizens is raised from Rs 20,000 to Rs 30,000.
- For uninsured super senior citizens (more than 80 years old) medical expenditure incurred up to Rs 30,000 shall be allowed as a deduction under section 80D.
- However, total deduction for health insurance premium and medical expenses for parents shall be limited to Rs 30,000.
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For consideration under a Senior citizen category, the person’s age should be 65 years during any part of the current fiscal, eg. for the fiscal year 2010-11, the person should already be 65 as on March 31, 2011),
Please note that Budget 2012 as changed the definition of senior citizen. Any person would be considered as senior citizen if he is 60 years old during the current financial year 2012-2013.
This deduction is also applicable to the payments made by either cheque or credit cards. So if payment is made by cash, this deduction would not be allowed.
Please note that Queries addressed below are relevant till financial year 2014-2015 only. Budget 2015 changes impact is not taken, while answering these queries.
Queries on Medical Insurance Premium
1. Can you please tell me the maximum amt of deduction u/s 80D for Individual – and for Family – Rohit Khurana , Noida
As per section 80D, you get benefit under Mediclaim policies
1. one for you and your family – Rs 15000
2. for your parents = Rs 15000
if person covered in 1 and 2 is 60 year old or more ( ie they are senior citizen) then 5000 additional deduction is available.
2. During the year i have paid one medical policy in cash and another by cheque. Would I get income tax benefot for the policy? Isha Ghai , Delhi
You will get Income tax deduction for policy for which you have paid by cheque.
3. In our organisation, a Senior person (62 years) is working. He have paid the mediclaim policy for Rs 25000 Lum Sum amount. In section 80D what will be the deduction limit in his case? Renu Mishra
Medical deduction u/s section 80D to senior citizen (above 60 years) would be available upto Rs 20,000/-.
In Budget 2012 , changes have been made. All Tax Individuals who are more than 60 years old during the financial year 2012-2013, would be considered as senior citizen.
4. Can salaried persons take the benefit of medical allowance & medicalim policy (U/sec 80D) in same time?
Shruti Bajaj, Indore
Yes, all salaried employee can claim both the benefits. Medical Allowance is allowed u/s sec 10 and Mediclaim allowance u/s 80D.