Got A Preventive Health Check-Up? Don't Forget To Claim A Tax Deduction
Published On Jun 28, 2021 10:00 AM By InsuranceDekho
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Having a health insurance policy in today's time is a necessity. You can count on the never-ending pros of owning a health insurance policy. One of the benefits that the policyholders are eligible to avail on the health insurance policies is a deduction of tax benefits. According to section 80D of the Income Tax Act, the premium payer gets relief in the tax payment.
With the set of benefits on a health insurance policy, you also get to go for a preventive health checkup one in a policy assessment year fixed by the insurer. Under your policy, the costs incurred during the health checkups are taken care of by the insurer. Since the scope of preventive healthcare check ups has increased over time, it has become eligible for tax reduction. Therefore, you can have relaxation on tax payments for premiums on preventive healthcare checkups. This preventive checkup ensures your safety and health. It also keeps you assured that you are perfectly healthy and sound.
Conditions To Claim A Tax Deduction On Preventive Health Care Check-Ups
It is important to visit the doctor once in a while for a preventive healthcare checkup for disease screening and identify the risk factors involved. For example, diseases like HIV, depression and many more need immediate attention and that can be acquired only when you visit the healthcare centres on a regular basis. Let us look at some conditions which are to be met in order to claim tax deduction under preventive healthcare check-ups:
- Within an overall limit of the premium for your mediclaim policy, a limit of Rs. 5000 is subsumed. That is, the amount spent in a financial year or Rs. 5000. The payment can be made in any mode. No additional deduction is provided for senior citizens who undergo preventive health care check-up.
- To avail this benefit of tax deduction, a certain amount of expenditure has to be made in a specified financial year. The preventive health care check-up can be done for yourself, spouse, children, or dependent parents, where there is no limit on the number of children in the family.
The following is the list of people who cannot be included to avail this benefit of a tax deduction on preventive health care check-up:
- Taxpayer’s in-laws
- Financially independent children
- Or, any other distant relatives.
Computation of Tax Deduction Under Preventive Health Care Check-Up
An amount of Rs. 25,000 is collectively deducted from the taxes under section 80D of the Income Tax Act. The amount deducted under the preventive health care check-up is a part of this cumulative amount. Let us look at some of the scenarios to understand the calculation part of this deduction process under the preventive health care check-up:
If the premium paid under your mediclaim policy is around Rs. 15,000 and the expenses incurred in the checkup is Rs. 10,000, then the tax deduction sums up to Rs. Rs. 20,000.
If the premium paid under your mediclaim policy is around Rs. 20,000 and the expenses incurred in the checkup is Rs. 7,000, then the tax deduction sums up to Rs. Rs. 25,000.
If the premium paid under your mediclaim policy is around Rs. 24,000 and the expenses incurred in the checkup is Rs. 2,000, then the tax deduction sums up to Rs. Rs. 25,000.
If there is no premium paid under your mediclaim policy and the expenses incurred in the checkup is Rs. 10,000, then the tax deduction sums up to Rs. Rs. 5,000.
In all the above cases, you may note that the cumulative tax deduction does not exceed its limit of Rs. 25,000. You may also keep in mind that to avail these benefits, it is not necessary to have a mediclaim policy.
To avail the benefit of tax reduction under preventive health care check-up, you need not submit any documents to the Income Tax department; however, you must preserve the receipt of the payment made. Also, this deduction benefit is applicable on an individual basis.
Also Read: Preventive Health Check-Ups and Tax Deductions
Exploring the Significance of Women's Choice for Preventive Health Check-Up
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.