It is important to get health insurance cover even before you start planning to save for your future goals. And the premium that you pay for health insurance provides tax benefits on all types of health insurance plans except for group health insurance. That is why it is advised to invest in a health insurance policy that will serve you the dual benefit of health protection and tax saving. And you can easily check the health insurance premium using a health insurance calculator; online.
Tax deduction is important for the government as the income tax paid by you is the major source of revenue for the government. It is your duty to pay taxes your taxes to the government until you want to pay the fine. But paying taxes is for the greater good as the government utilized this money to benefit the society in return. If you have a health insurance policy and you renew it next year then also your tax benefits will continue.
While the government levies taxes, it also gives you a chance to save taxes on your annual income and health insurance is one way of doing so. Under the purview of the Income Tax Act of 1962, every health insurance policyholder can avail tax-saving benefits under Section 80D of the IT Act. Tax exemption benefits are applicable to health insurance policies purchased for self, family, and even top-up plans. The tax benefits are in addition to the basic tax-exemption limit of Rs. 1.5 lakh.
You can use the health insurance calculator while choosing a health plan to check the premium online and know your tax exemption limit as given below.
You just need to mention the name of your policy, the premium amount and select the deduction under Section 80D to avail tax exemption benefits on your health insurance premium.
An individual or a HUF can avail tax saving benefits under Section 80D of the Income Tax Act.
However, the tax exemption benefits would vary on the basis of the age of the policyholder, the premium amount and the age of the family members who are insured. The tax slab also varies on the basis of the income tax bracket that you fall into.
Though the tax exemption limit differs for different slabs, there are different tax deductions that are available to reduce the income tax liability. Check out the different types of tax exemption benefits that you can avail on the health insurance premium that you pay every year:
Below are some tax benefits on health insurance premium under the purview of the Income Tax laws:
In a Nutshell
Taking into consideration the increasing medical costs a health insurance policy is no less than a necessity. But do not just invest in a health insurance plan just to save taxes. However, buy a health insurance policy to avail health cover along with tax-saving benefits. So, when you buy a health plan or if you already have health insurance then make sure that you avail of the above-mentioned tax benefits as well.
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