Are health insurance premiums tax-deductible?

Health insurances are a great way to secure yourself and your family from any medical emergencies, but they are so much more than just that. As facilitated by the Indian government, Mediclaim and health insurances offer an income tax benefit to the policy holder.

Under section 80D of the Income tax Act, 1961, the premiums paid for health insurance plans for oneself, partners, children and parents are eligible for tax deductions in a financial year. Thus, making health insurances an important investment not only for your health, but also for your finance.

The deductions one can avail on their health insurance premium is on the basis of certain criteria that needs to be fulfilled. Thus, tax deductions are different for different individuals falling in separate criteria.

Apart from the above-mentioned deductions, tax payers can also claim an additional Rs.5,000 against preventive health care checkups in a financial year.

In addition to tax deductions one can avail for themselves and their family, an added benefit can be availed by an individual against health insurance premiums paid for parents or guardians. A sum of up to Rs.25,000 extra is deductible in case of parents below the age of 60 and the same is extended to Rs.30,000 if the parents/ guardians of the tax payer are senior citizens (Above the age of 60). An additional reduction of Rs.5,000 in income tax is also offered against preventive health checkups in a financial year.

The tax benefits one can avail against health insurance premiums in a financial year are capped at Rs.65,000. And the following table elaborates on each deduction bracket.

According to the insurance plans availed by the individual for themselves and their family, their income tax liability is advised. Thus, with such high tax benefits, health insurances are not only a protection against illnesses and health emergencies, but play a pivotal role in one’s financial planning.