Section 80D of the Income Tax allows deduction from taxable income in respect of medical insurance premium or medical expenses paid for your family. Let’s analyze how you can save tax while taking care of your family.

Deduction under section 80D is allowed for

  • A medical insurance premium paid in any mode other than cash

  • Expenditure incurred on the account of preventive health check-up

Deduction under section 80D

  • The contribution made to the Central government health scheme or any scheme as notified by the government.

  • Medical expenditure incurred on the health of senior citizen (aged 60 years or above) who is not covered under any health insurance scheme.

Section 80D allows deduction

Section 80D – Medical Insurance – Who is eligible?

  • Self

  • Spouse

  • Dependant Children

  • Dependant Parents

Deduction under section 80D is allowed for

  • Up to INR 25000 if individual, spouse or children are below 60 years of age

  • Up to INR 50000 if individual, spouse or children are above 60 years of age

Deduction under section 80D
Section 80D allows deduction

Section 80D also allows additional deduction for parents

  • Up to INR 25000, if parents are below 60 years of age

  • Up to INR 50000, if parents are above 60 years of age

Now, let’s use the income tax calculator to see how much tax you can save by claiming medical insurance under Section 80D.

Step 1: Open the income tax calculator

Step 2: Key in your salary details

Salary details
Salary details

Step 3: Declare your investments

Declare investments

Step 4: Now, calculate income tax

Calculate income tax

As per the calculation, you have a total tax liability of INR 100000

Step 5:  Declare Medical Insurance – Section 80D

Medical Insurance Premium for yourself and parents who are Senior Citizens

Choose this option if you, your spouse or children are under the age of 60.

Declare Section 80D Contribution

If you, your spouse or children are above the age of 60, you should choose this option instead.

Declare Section 80D Contribution
Declare Section 80D Contribution

Similarly, choose this option if your parents are under the age of 60.

Declare Section 80D Contribution

If your parents are above the age of 60, you should choose this option instead.

Declare Section 80D Contribution
Declare Medical Insurance for Parents

Step 6: Calculate income tax again

Calculate income tax

As you see, the taxable income has come down by INR 100000 and the total tax liability has come down to INR 79200; You saved INR 20800.

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Section 80D allows you to save income tax while taking care of your family.