How Can Health Insurance Help You Save Money on Taxes?

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Health Insurance

If you are a health insurance policyholder, then you can avail tax deductions. You, your spouse, and your dependent children can all benefit from the policy’s coverage. If you or your spouse are 60 years old or older, the tax advantages on senior citizen Vital Health Cover policies will be increased to Rs. 50,000. This limit is supplemented by Rs. 5,000 in supplementary coverage for health check-ups for family members, including parents, spouses, and dependent children.

Preventative Health Exams

Expenses for preventative health check-ups during the insurance term might help you save money on taxes. Rs. 25,000 if you are under 60 years old and Rs. 30,000 if you are over 60. You can also claim an extra benefit of up to Rs. 5,000 in coverage for preventative health check-ups each year.

Parental Health Insurance Policy

If you pay the premium for any of your parents’ health insurance, you can claim an extra tax break under section 80D of the Income Tax Act of 1961. However, you are entitled to a deduction of up to Rs. 50,000 every year.

There is no tax benefit for cash payments.

To qualify for a Tax Saving Investment break, a health insurance policy’s premium must be paid via particular banking methods, such as a demand draft, check, debit or debit cards, or net banking. However, you can save money on taxes by deducting charges for preventative health check-ups that were previously paid in cash.

Very Senior Citizens’ Health Insurance

Senior persons (80 years or more) who are not covered by any sort of health insurance coverage are entitled to a tax deduction of up to Rs. 30,000 every financial year for medical costs. Rs. 35,000 under section 80D of the Income Tax Act for medical treatment and preventative health check-ups for both your parents who are elderly citizens.

Eligibility for an Income Tax Deduction under Section 80D of the Internal Revenue Code

The premiums you pay for health insurance coverage are not deductible from your taxable income for that fiscal year. If you have a family floater health insurance plan that covers you, your spouse, and your children, the premium paid for individual family members’ coverage minimizes your income tax burden.

  • You, on the other hand (policyholder)
  • Your Partner
  • Your Youngsters
  • Parents who are reliant on you

A HUF (Hindu Undivided Family) can claim a tax advantage under this section based on the premium of an individual member, subject to the upper maximum of tax benefit under this section.

Section 80DDB allows you to save money on taxes (Treatment of Critical Illnesses)

Your health insurance coverage gives tax deductions up to Rs.40,000 and Rs.60,000 for senior people, and Rs.80,000 for very senior persons, in addition to protecting you against serious diseases. Medical costs paid owing to a certain ailment, such as cancer, chronic renal failure, or cardiac disease, are eligible for a tax credit ranging from Rs. 40,000 to Rs. 80,000. The list of illnesses covered by Rule 11DD includes certain particular illnesses. When completing an income tax return, you must include a certificate from a doctor.

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