How To Save Tax With Reliance Health Insurance Plans?
Published On Jun 15, 2021, Updated On Jul 15, 2021
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Tax saving is an essential part of financial planning for an individual. While saving taxes through investments in health insurance, it is important that it serves you double benefits. One of which being, saving taxes annually and the other being, procurement of financial benefits in case of a medical emergency. While saving your taxes by investing in health insurance, you get many other beneficial features like cashless claims, pre and post-hospitalization covers, and domiciliary treatment expenses.
Reliance Health Insurance is a well-known reputed firm in our country and is trustworthy among its customers. Due to the comprehensive and exclusive services provided by Reliance Health Insurance, it is a reliable option to invest your money in. If you purchase a health insurance policy from Reliance Health Insurance, then along with the tax-saving benefits you will become eligible to avail many other features that are customized specifically for a group of customers by Reliance Health Insurance.
Limitations of Tax Benefits From Health Insurances
Before planning a full-fledged investment in health insurance for the purpose of tax saving, keep in mind the following limitation:
- Provided that the individual is not more than 60 years of age, he/she can avail a maximum deduction of Rs. 25,000 per year on the premium paid for self, spouse, children, and parents.
- If an individual less than 60 years of age, pays a premium for his/her parents in a senior citizen plan, where both parents are 60 years and above in age, then the individual is eligible to cap a tax deduction of Rs. 75,000 per year.
- If a taxpayer is 60 or more in age and pays a premium for insurance plans covering his/her parents, then the individual can avail a maximum tax deduction of Rs. 1 Lakh per year.
Ways to Avail Tax Benefits From Health Insurance Policies
The premiums that are paid by the insured can be exempted from taxes according to section 80D of the Income Tax Act. Following are the key elements that help in legally saving the taxes through health insurance policies:
1. Health Insurance For The Family
If you have purchased a family floater plan from Reliance Health Insurance for all the members of your family, then the premium payable for the coverage availed by an individual family member reduces your income tax liability. The relations within the family that can avail tax-saving benefits include individual, spouse, children, and dependent parents. You can save up to Rs. 50,000 per year.
2. Preventive Health Check-Up
As per section 80D of the income tax act, the maximum limit of the tax deduction for people of age below 60 years is Rs. 25,000 and for people above the age of 60 years is Rs. 30,000. Preventive health checkups can save taxes based on the expenses incurred in checkups during a policy tenure. It gives you an additional benefit of up to Rs. 5,000.
3. Premium Payment Mode
While making payments for health insurance premiums to Reliance Health Insurance, make sure you do it via demand draft, credit card, or net banking. If the payments are made in cash then you are not liable to benefit tax deduction.
Things To Note For Tax Saving Through Health Insurance
Some other things to keep in mind for tax reduction via health insurance investment in Reliance Health Insurance are:
- If you have purchased only a critical illness policy from Reliance Health Insurance, then too, you are liable to benefit from a tax reduction of Rs. 40,000 to Rs. 80,000 under section 80DDB for treatment of critical illness.
- You can save taxes on the treatment of a dependent with a disability. According to section 80DD, the taxpayer can avail a deduction of Rs. 75,000 per year.
- A person with a disability can get a tax deduction of Rs. 75,000 to Rs. 1.25 Lakh under section 80U.
- According to section 17, tax can be saved on a medical allowance of up to Rs. 15,000 per year.
Investing in health insurance policies is a legal way of saving taxes. However, other fraudulent ways of exempting the taxes should not be adopted. You can invest in Reliance Health Insurance to avail of tax deductions and enjoy other benefits of the health insurance policies.
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.