Everyone knows about the benefits of getting a comprehensive health insurance plan in India. It’s is a great way to ensure financial coverage to cover any medical and hospitalization costs.
However, did you know that health insurance provides additional benefits including tax benefits?
In this article you’ll learn about one of the biggest benefits of health insurance which are tax exemption benefits.
#Health insurance policy-One of the best tax saving instruments
Health insurance India is a growing sector providing financial assistance to millions of people against rising medical and hospitalization costs. However, there are many people with low health risk factors who buy health insurance policy in India to save tax. As per Section 80D of the Income Tax Act, the premium amount paid for health policy is exempted from tax. Hence, you don’t have to pay tax for the premium amount which is deductible.
#Who can receive tax benefits of health insurance?
All individuals and HUF (Hindu Undivided Families) members are liable to receive tax benefits as per Section 80D of income tax act. You receive a benefit of deduction up to Rs.15, 000 from the taxable amount. Therefore, if you, your spouse and your children have individual health insurance policies then the total deductible amount will be Rs. 45,000/-. Hence, you receive greater tax benefits.
#Additional tax benefits for certain age brackets
Parents below 60 years of age, get additional benefit of tax deduction of Rs.15, 000/- per year. On the other hand, parents above 60 years of age, get additional benefit of tax deduction of Rs. 20,000/- per year.
Therefore, a person can receive total tax benefit of Rs. 35,000 by investing in these policies.
#Are you aware of an added health insurance benefit of extra Rs.20, 000?
Many people tend to neglect to invest in parent’s healthcare insurance policy. Surprisingly, many people who include various accountants are unaware of an added benefit of health insurance. When a person invests in health care insurance for parents, he/she receives Rs. 20,000 extra deduction as tax benefit. Also from a monetary perspective, it’s better as along with providing an added benefit, it covers all the parental medical costs.
However there are certain limitations. They are-
- Premium can be paid only in cash.
- People who have invested in various corporate health plans cannot benefit from these deductions. In order to get these benefits, you will be required to use a payroll deduction system or online electronic payment modes for payment of premiums.
#Health insurance fulfills two important motives
People search for tax saving instruments within India to save tax. Health insurance policies of India fulfil 2 important motives. It provides significant tax benefit as well as provides a sufficient health cover for individuals and his entire family. Hence, health insurance is one of the best tax saving instruments of India plus a great health care option too!