Please note that the premium of mediclaim should not be made in cash otherwise you will not be able to claim the tax benefits
I am a bachelor aged 45 years. How much tax benefits is available for health insurance policy purchased by me for myself and my parents who are Senior Citizens? - Satya Prakash
Answer: Under Section 80D of the Income Tax Act you are entitled to claim deduction for premium paid for health insurance policies, popularly known as mediclaim. There are two categories for whom you can pay the premium and claim this deduction. Under the first category is covered your family which includes you, your spouse and all your dependent children. Under the second category you can claim deduction for health insurance premium paid for your parents whether financially dependent on you or not.
The amount of maximum deduction available for each of the category is up to Rs. 25,000. In case the person, in respect of whom the premium is being paid, is a over 60 years of age, the maximum deduction available goes up to Rs. 50,000. So you will be able to claim a maximum deduction of up to Rs. 75,000 i.e. ₹25,000 for you and ₹50,000 for your parents as they are senior citizens.
Within these overall limits of ₹25,000 and Rs. 50,000 as the case may be, you can claim an amount up to ₹5,000 each in respect of any amount paid for preventive health check-up for yourself as well as for your parents. Please note that the premium of mediclaim should not be made in cash otherwise you will not be able to claim the tax benefits. Cash, however, can be paid for preventive health check-up. The amount paid for medical testing done prior to hospitalisation is not eligible under this sub limit of Rs. 5,000.
The writer is a tax and investments expert and can be reached at firstname.lastname@example.org