Section 80D Tax Benefits on Preventive Health Check-ups

Posted on: Dec 9, 2021 | 3 mins | Written by: HDFC ERGO Team

Section 80D Tax Benefits on Preventive Health Check-ups

Section 80D of the Income Tax Act not only helps you save money on health insurance premiums but also offers tax benefits on preventive health check-ups. You can claim up to INR 5,000 in a financial year for check-ups done for yourself, your spouse, children or parents. However, this amount is part of the overall deduction limit under Section 80D. While you don't need to submit documents when filing your taxes, it is a good idea to keep bills and payment receipts as proof.

Section 80D of the Income Tax Act, 1961, allows tax deductions of up to INR 25,000 for policyholders under 60 years of age. Senior citizens can avail health insurance tax benefit 80D of up to INR 50,000 every financial year.

Besides, individuals or policyholders can also claim a tax deduction of up to INR 5,000 under the preventive health checkup income tax benefit.

What is Section 80D?

Section 80D of the Income Tax Act, 1961 helps you save tax on the amount you spend on health insurance premiums. You can claim a total deduction of up to INR 1 lakh per financial year, depending on the coverage and age of the individual.

This benefit is available for health insurance taken for yourself, your spouse, dependant children and parents. Members of a Hindu Undivided Family (HUF) can also claim this deduction.

The amount you can claim depends on the age of the people covered. Here's how it works:

You can claim up to INR 25,000 if the policy covers you, your spouse, and children, and everyone is under 60 years of age.

You can claim an additional deduction of INR 25,000 if you buy insurance for your parents under 60.

If you or a family member is 60 or older, you can claim a tax deduction of INR 50,000 on the health insurance premium paid.

If your parents are 60 or older and you pay their health insurance premiums, you can claim a tax deduction of INR 50,000.

Members of a HUF can claim a deduction of up to INR 25,000 if below 60 years of age, and up to INR 50,000 if aged 60 or above.

Therefore, if you are covering both younger and older family members, you can save up to INR 1,00,000 in taxes every year.

What is Preventive Healthcare Under Section 80D?

Preventive healthcare involves preventive measures that you can take to keep different diseases at bay. This includes taking flu shots and immunisations and opting for blood tests, cancer screening, blood pressure and cholesterol monitoring, diabetes tests, HIV tests, and more. Preventive healthcare is particularly important after the age of 40, when the chances of suffering from different health conditions are high. It is also important for those with a family history of certain diseases, such as diabetes, high blood pressure and cancer.

Many medical insurance plans offer complimentary preventive health check-ups for policyholders at the time of policy renewal. If your insurer does not offer this facility, you can purchase a preventive healthcare package at an affordable premium. Some preventive healthcare packages available in the market are:

• Family package

• Package for children

• Cancer package

• Cardiac package

• Dental package

• Diabetes package

Features and Benefits of Preventive Health Check-ups?

Here’s a look at the benefits of opting for preventive health check-ups:

Early detection of diseases:

Preventive health check-ups help in the early detection of health conditions and their timely treatment. This helps increase the chances of a cure and survival.

Reduces the risk of complications:

Timely detection and treatment also alleviate the risk of complications that may arise when a disease is in an advanced stage.

Helps reduce healthcare costs:

The cost of treating a disease in the early stages is much lower. Preventive health check-ups also reduce the chances of costly emergency treatments.

Identifies potential conditions:

Preventive health check-ups help detect signs of potential health conditions, such as diabetes, high blood pressure, and more. Thus, you can make necessary changes to your lifestyle or opt for certain treatments to prevent the condition from worsening.

Eligibility to Claim Preventive Health Check-up Deduction Under Section 80D?

Under Section 80D of the Income Tax India Act, individuals who undergo preventive health check-ups can enjoy tax deductions of up to INR 5,000 per financial year. You can also avail tax benefits on the amount spent on preventive health check-ups for your spouse, children and parents. Hence, people eligible for the preventive health check-up under Section 80D should definitely file for a claim.

Know More: 80D Benefits on Your Medical Insurance Policy

Maximum Deduction Limit for Preventive Health Check-ups Under Section 80D

You can claim a maximum amount of INR 5,000 per financial year against preventive health check-ups. This deduction can be claimed by you as well as your spouse, children and parents. So, if you or your loved ones undergo preventive health check-ups that amount to INR 10,000, you will be eligible for tax deductions of INR 5,000 at the time of filing IT returns. This deduction can be claimed even if you have paid the bills through cash, unlike for health insurance policies that require policyholders to pay premiums through organised banking channels to avail tax benefits.

Another thing to keep in mind is that you can enjoy a maximum tax deduction of up to INR 25,000/50,000 jointly on your medical insurance premium and preventive health check-up bills. For instance, if you are 40 years old, you can claim a maximum tax deduction of INR 25,000. Say you paid a premium of INR 22,000 towards your health insurance policy and spent INR 6,000 on preventive health check-ups during the same financial year. Since you can claim a maximum deduction of INR 25,000 only, the tax deduction towards preventive health check-ups will be INR 3,000 (25000-22000 = 3000).

Can I Claim Deduction for Preventive Check-ups Paid in Cash?

Yes, you can claim a deduction for preventive health check-ups paid in cash, but you must keep proper bills or receipts as proof. The bills should clearly mention the details of the check-up and the amount paid.

Make sure to keep these documents safe because the insurer or tax authorities may ask for them when you file your claim or tax return.

Documents Required to Claim Section 80D Deduction

In most cases, the income tax department doesn’t ask for documents or receipts when you file your Income Tax Return (ITR) to claim this deduction. However, it is wise to keep your payment receipts or proof of premium payment safely with your tax records, just in case you need to provide them later.

Here’s a list of the documents you might need to claim a deduction under Section 80D:

Health insurance premium payment receipt

Bills and receipts for preventive health check-ups

Health insurance policy document

Proof of identity, like Aadhaar card, PAN card or any government ID

Other Deductions Available Under Section 80D

Besides preventive health check-up 80D benefits on health insurance premiums, the section allows the following deductions:

Medical expenses:

If you are a senior citizen and are not covered under health insurance, you can claim up to INR 50,000 for medical expenses like doctor visits, medicines and medical aids.

Contribution to CGHS or other notified schemes:

You can claim up to INR 25,000 for contributions made to the Central Government Health Scheme (CGHS) or other approved schemes. However, if you have made the payment on behalf of yourself, you can’t claim this benefit for your parents.

Conclusion

Opting for preventive health check-ups is one of the wisest things you can do for yourself and your family. These preventive tests help detect health conditions at an early stage, making their treatment easier, quicker and economical. If your medical insurance policy includes free preventive health check-ups, you can easily avail of this facility during policy renewal. All you need to do is pay a certain amount towards the medical insurance premium every year, In case your health plan does not include preventive health check-ups, or you don’t have health insurance, you can take a suitable preventive health check-up package for yourself and your loved ones. Besides good health, you can also enjoy tax deductions and save some money this way.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

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