According to the Income Tax Department, you can get tax benefit of 50 thousand or more.
Getting health insuran ce is advised to every section of the people, as it protects the future of your family. It covers everything from serious diseases to medicines and treatments. This policy helps to meet any planned or unforeseen expenses on hospitalization and medicines. Also tax benefits can be availed.
As per Section 80D of the Income Tax (IT) Act, you can avail tax deduction of Rs 50,000 towards premium paid on a policy for senior citizens and Rs 25,000 for others in your family in a year. But in some cases you cannot avail tax exemption.
no cash payment
Policyholders can claim tax exemption on their health insurance policies only if they pay the premium through any mode other than cash. Experts point out that while buying a policy, you should either pay the premium by cheque, or transfer funds through NEFT, IMPS or UPI. Anoop Bansal, Chief Business Officer, Scripbox said that you need to use the offline or online banking route to be eligible to avail the tax benefits.
no proof no benefit
Employees of most organizations are required to submit investment declaration forms at the beginning of the financial year, usually in January and February. They have to fill the details of their investment and insurance premium in that form. According to Mint, while claiming health insurance tax benefits during the financial year, you need to send the investment proof to your employer via mail or upload it on the employer’s HRMS portal. Failure to do so will result in no tax benefit.
other restrictions
Any payment made for a policy taken in the name of another who is not a part of your ‘family’ will not be eligible for the tax deduction benefit. You can claim the benefit only if you can claim a discount on a policy purchased for self, spouse, children and parents.
multi year policy
It is important to understand the benefits of a multi year health policy. If you obtain separate receipts for each year from the insurer, you can claim tax deduction benefit proportionate to the policy term. If not, you can claim tax benefits only for one year.
