Income Tax Act has given additional deduction under section 80D for payment of Medical Insurance Premium. This deduction is available up to Rs. 20,000/- for senior citizens and upto Rs. 15,000/- in other cases for insurance of self, spouse and dependent children. Additionally, a deduction for insurance of parents (father or mother or both) is available to the extent of Rs. 20,000/- if parents are senior Citizen and Rs. 15,000/- in other cases. Therefore, the maximum deduction available under this section is to the extent of Rs. 40,000/-. From AY 2013-14, within the existing limit a deduction of upto Rs. 5,000 for preventive health check-up is available. Deduction under section 80D is additional deduction i.e. Individual can claim Rs 100000/- under 80C plus Rs 15000/- under 80D.
Exemption—Sec. 14A, 37(1), 80D—IT ACT, 1961—HOSHANG D. NANAVATI v. ASSISTANT COMMISSIONER OF INCOME-TAX. [2012] 16 ITR (Trib) 614 (ITAT-MUMBAI)
Reference: – As Per Section 80D of the Income Tax Act 1961
Deduction in respect of health insurance premium.
80D. (1) In computing the total income of an assessee, being an individual or a Hindu undivided family, there shall be deducted such sum, as specified in sub-section (2) or sub-section (3), payment of which is made by any mode [as specified in sub-section (2B),] in the previous year out of his income chargeable to tax.
(2) Where the assessee is an individual, the sum referred to in sub-section (1) shall be the aggregate of the following, namely:—
(a) the whole of the amount paid to effect or to keep in force an insurance on the health of the assessee or his family [or any contribution made to the Central Government Health Scheme] [or such other scheme as may be notified by the Central Government in this behalf] [or any payment made on account of preventive health check-up of the assessee or his family] as does not exceed in the aggregate fifteen thousand rupees; and
(b) the whole of the amount paid to effect or to keep in force an insurance on the health of the parent or parents of the assessee [or any payment made on account of preventive health check-up of the parent or parents of the assessee]as does not exceed in the aggregate fifteen thousand rupees.
- —for the purposes of clause (a), “family” means the spouse and dependent children of the assessee.
(2A) where the amounts referred to in clauses (a) and (b) of sub-section (2) are paid on account of preventive health check-up, the deduction for such amounts shall be allowed to the extent it does not exceed in the aggregate five thousand rupees.
(2B) for the purposes of deduction under sub-section (1), the payment shall be made by—
(i) Any mode, including cash, in respect of any sum paid on account of preventive health check-up;
(ii) Any mode other than cash in all other cases not falling under clause (i).
(3) Where the assessee is a Hindu undivided family, the sum referred to in sub-section (1) shall be the whole of the amount paid to effect or to keep in force an insurance on the health of any member of that Hindu undivided family as does not exceed in the aggregate fifteen thousand rupees.
(4) Where the sum specified in clause (a) or clause (b) of sub-section (2) or in sub-section (3) is paid to effect or keep in force an insurance on the health of any person specified therein, and who is a senior citizen, the provisions of this section shall have effect as if for the words “fifteen thousand rupees”, the words “twenty thousand rupees” had been substituted.
- —for the purposes of this sub-section, “senior citizen” means an individual resident in India who is of the age of [sixty years] or more at any time during the relevant previous year.
(5) The insurance referred to in this section shall be in accordance with a scheme made in this behalf by—
(a) the General Insurance Corporation of India formed under section 9 of the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972) and approved by the Central Government in this behalf; or
(b) any other insurer and approved by the Insurance Regulatory and Development Authority established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999).