Is Proof Necessary While Claiming Medical Expenses Under Section 80D?
Health is the greatest asset of our lives. There is no greater truth than that. As long as we have health on our side, there is no mountain we cannot scale. But the thing with health, especially in today’s day and age, is that it can deteriorate at any given time. Ill health can be caused by internal or external factors and can take you by surprise at any given time.
The only constant about health is that health care is superbly expensive. From a simple check-up to our monthly medical bills, it all adds up to surprising amounts of money. But, if you have the right health insurance policy, you can save a substantial amount of money on your medical expenses.
You may be wondering how your many medical bills and expenses can help you save money eventually. Well, the answer is simple; Section 80D of the Income Tax Act. However, before we get into the details of the 80D deduction, it is important to understand one simple fact. To claim medical expenditure under 80D, we first need to have a health policy from a recognisable health insurance company like Tata AIG. Having medical insurance in India has several benefits, including tax benefits.
What is an 80D Deduction?
Section 80D of the Income Tax Act allows taxpayers to deduct up to ₹25,000 in medical expenses for themselves and their families. You can also avail of a deduction of ₹25000 if you have bought medical insurance premiums for your parents(who are less than 60 years). If your parents are above 60 years of age, you can avail of an increased deduction of ₹50,000.
Health insurance tax exemptions are covered by Section 80D of the Income Tax Act of 1961. This section lets you claim tax deductions for health policy premiums paid for yourself and your family. In addition, section 80D medical expenditure provides additional deductions and the exemptions provided by Section 80C. As for proof, no proof is required when you claim deductions under section 80D of the IT Act.
Who can Claim Deductions Under Section 80D?
If you are paying for health insurance plans for your family or parents over 60 years old, tax deductions can be claimed. According to the law, a family member includes oneself, spouse, and children. Therefore, a person who has incurred medical expenses can claim a tax deduction for such expenditures. If you are over 60 years old and do not have any other health insurance policy, you can still claim the exemption.
If an individual has undergone medical costs for their parents over 60 years old, they are eligible for a deduction.
What All Can we Claim Under Section 80D?
The Income Tax Act does not specify which medical bills or conditions are covered. However, per the government’s amendment, expenditures for medications, assessment fees, and other medical equipment such as hearing aids, implanted devices, and so on, which were not covered earlier, would now be considered.
In addition to Section 80DDB, Section 80D addresses certain illnesses or health conditions for a specified age range. If your health condition falls under that group, you can file a claim per section 80DDB. However, if the medical condition does not fall into that category or the maximum has been reached, the remaining medical costs can be claimed under section 80D.
Important Things to Remember
Before getting medical insurance in India, there are a few things to keep in mind:
- A tax deduction cannot be claimed under Section 80D if premiums are paid by you in favour of employed children.
- If you purchase insurance for your siblings, uncles, grandparents, aunts, or any other relatives, tax deductions cannot be claimed.
- If you as well as your parents paid some part of your premiums, you both could receive tax advantages under Section 80D.
- A tax deduction cannot be claimed for the amount that you paid for group medical health insurance provided by your employer.
- You must subtract the premium that you have paid without considering the cess and service tax portion.
Knowing all there is to know about 80D deductions is always useful and can help you save a pretty penny. Just be careful to read the fine print of your medical policy and know the exclusions under 80D, and you will not have to face any surprises in the future.