An assessee can claim following payments made as per Indian Income Tax Act in respect of various types of medical expenses incurred during or payment made under medical insurance schemes:-

 MEDICLAIM UNDER SECTION 80-D DURING FINANCIAL YEAR 2014-15

Following points should be kept in mind while claiming deduction under section 80-D in respect of expenses incurred for health insurance in financial year 2014-15 as under:-

  1. The deduction is allowed on health insurance premium to individual on himself, spouse and dependent children up to Rs.15000/= from taxable income.
  2. The deduction is also allowed to H.U.F. for insurance of health for any member of family.
  3. For senior citizen the amount spent on health insurance premium is allowed up to Rs.20000/=. Senior citizen means who has completed 60 years of age in current financial year.
  4. Any individual can spent an additional amount up to Rs.15000/= on insurance of his/her parents or parent. If any one of  parents is senior citizen then the amount can be spent up to Rs.20000/=. It is not necessary that to claim Rs.20000/= both parents should be 60 or more.
  5. Any amount spent on himself/herself or spouse or parents and dependent children for preventive health check up maximum up to Rs.5000/= also can be claimed but under the ceiling limit of Rs.15000/= or Rs.20000/= as per the case may be.
  6. The deduction can be claimed for parents whether they are dependent or no.
  7. The preventive medical expenses may be paid in cash or through bank.
  8. In case of HUF, medical insurance premium paid for any member of family is allowed as deduction for Rs.15000/= and Rs.20000/= for senior citizen.

EXAMPLES:

Illustration – 1:- Mr. X is 30 year old. His family includes his wife, his son and parents who are below 60 years. during financial year 2014-15, he paid for medical insurance premium Rs.16000/= for himself, wife and his son and for his parents Rs.20000/=. Further he spent Rs.3000/= on preventive health check up of his parents. How much he can claim as deduction under section 80-D ?

Solution:- In this case, Mr. X can claim as deduction under section 80-D for Rs.15000/= for himself, wife and son in respect of medical insurance premium paid. An additional amount of Rs. 15000/= also can be claimed for medical insurance premium paid for his parents. Please note that he has already availed the maximum limit of medical insurance claim for his family and parents. Therefore, the amount spent of preventive health check up of his parents for Rs.3000/= may not be allowed as deduction under section 80-D.

Illustration – 2:- Mr. Y is 35 year old. His family includes his wife one dependent daughter, mother who is 58 old and his father who is 61 year old. during financial year 2014-15, he paid as medical insurance premium for Rs.13000/= for himself, wife and daughter. He also paid medical insurance premium for Rs.18000/= for his parents. Further he spent for preventive health check up for himself Rs.3000/= and for parents Rs.5000/=. How much he can claim as deduction under section 80-D?

Solution:- In this case, Mr. Y can claim as for medical insurance premium for Rs.13000/= for himself, wife and daughter and for his parents he can claim Rs.18000/= under section 80-D. Further he can claim for preventive health check up for himself and parents Rs.4000/=. According to condition of claim under section 80-D, Mr. Y can claim up to Rs.35000/= and he has paid for medical insurance premium Rs.31000/= for his family and parents. Balance amount Rs.4000/= (Rs.3000/= for himself plus Rs.1000/= for his parents) can be claimed for preventive medical health check up. Please note that In this case, father is only senior citizen and mother is under 60, even then he can claim Rs.20000/= for parents. It is not necessary that both parents should be 60 or more.

Illustration – 3:-Mr. A is 61 year old. His family includes his wife and two sons who are not dependent and his father who is 86 year old. During financial year 2014-15, he paid medical insurance premium of Rs.13000/= for himself and wife. He also paid Rs.15000/= for his father as medical insurance premium and Rs12000/= for his two sons. How much he can claim as deduction under section 80-D?

Solution:- In this case Mr. Y can claim Rs.13000/= for medical insurance premium for himself and his wife but not for his son since they are not dependent on him. Mr. A also can claim an additional amount of Rs. 15000/= for medical insurance premium for his father.

 MEDICLAIM UNDER SECTION 80-D FINANCIAL YEAR 2015-16 ONWARDS

In respect of deduction for Mediclaim under section 80-D every thing is same as mentioned in financial year 2014-15 except the following changes:-

  • Expenses incurred in respect of medical insurance premium and preventive health check up for self or spouse and dependent children is increased to Rs.25000/=. In financial year 2014-15 the maximum amount of deduction was Rs.15000/=.
  • An additional expenses incurred in respect of medical insurance premium paid and preventive health check  for parent or parents is increased to Rs.25000/= if no one of parents is a senior citizen. If one of parents is senior citizen or both are senior citizen then the permissible deduction will be Rs.30000/=.
  • For medical treatment expenditure of any parent(s) (being very senior citizen) not having medical insurance cover) shall be allowed as deduction maximum up to Rs.30000/=. Very Senior Citizen means a person who has completed 80 years of age in relevant financial year.

MEDICAL TREATMENT AND DEPOSIT MADE FOR HANDICAPPED DEPENDENT (U/S 80DD)  DURING FINANCIAL YEAR 2014-15

  1. This deduction is allowed to an Individual or Hindu Undivided Family.
  2. The amount spent by assessee for medical treatment of one or more dependent handicapped person.
  3. Amount deposited under any approved scheme of any insurance company or Unit Trust of India for the benefit of the handicapped dependent or dependents.
  4. The deduction will be allowable is Rs.50000/= even the assessee has not incurred the expenditure of Rs.50000/= in medical treatment or deposits made under above scheme. For example the assesse has paid Rs.40000/= for treatment and deposit for dependent even he/she is allowed to claim Rs.50000/= as deduction under section 80-DD.
  5. In case of person with severe disability, the amount of deduction may be allowed up to Rs.100000/=.
  6. Dependent means, for individual assessee his/her spouse, children, parents, brothers and sisters. In case of H.U.F. dependent means any member of H.U.F.
  7. The dependent has not claimed any deduction under section 80-U.
  8. Disability means who is disable from over 40% to 80% as defined by Disability Act or other related Acts.
  9. Severe disability means a person who is disable more than 80% as per Disability Act or other related Acts.
  10. The deduction for deposit under approved schemes can be allowed only if the assessee nominates either dependent or a person who will receive the payment for the benefits of the dependent.
  11. Suppose, the assessee dies before the dependent, the amount  is paid in lump sum under the scheme for the benefit of the dependent.
  12. In case, the handicapped dies before the assessee, any amount received under the scheme, shall be added in the income of assessee in the year he/she received the amount.
  13. The assessee must obtain the certificate of disability from a doctor who has been defined under the Income Tax Act.

MEDICAL TREATMENT AND DEPOSIT MADE FOR HANDICAPPED DEPENDENT (U/S 80DD)  DURING FINANCIAL YEAR 2015-16 ONWARDS

Every thing is same in respect of deduction under section 80DD as mentioned in financial year 2014-15 except the following changes made during financial year 2015-16:-

  • Any expenditure made on treatment of one or more handicapped dependent is allowed as deduction for Rs.75000/= irrespective of expenditure incurred or deposit made under an approved scheme of the Life Insurance Corporation of India or other insurance company or the Unit Trust of India, for the benefit of dependent with disability. In financial year 2014-15 this amount of permissible deduction was Rs.50000/=.
  • In case of person with severe disability, deduction allowable is Rs.125000/= irrespective of expenditure incurred or deposit made under approved schemes. For example the person concerned incurred an expenditure on his/her treatment for Rs.80000/= during financial year 2015-16, the deduction under this section will be allowed for Rs.125000/= . In financial year 2014-15 this amount of permissible deduction was Rs.100000/=.

 DEDUCTION IN RESPECT OF MEDICAL TREATMENT RELATING SOME SPECIFIED DISEASES (U/S 80DDB) DURING FINANCIAL YEAR 2014-15

  1. The deduction u/s 80DDB is allowed to an Individual or Hindu Undivided Family.
  2. An individual can claim deduction in respect of amount spent for him self or any dependent. Dependent means hi/her spouse, children, parents, brothers or sisters.
  3. In case of H.U.F., any member of the family.
  4. The allowable deduction is the actual amount spent or Rs.40000/= whichever is less.
  5. For senior citizen the amount of deduction is allowable up to Rs.60000/=
  6. The deduction shall be reduced by the amount received from any insurance cover etc.
  7. The specified diseases are defined in Income Tax Act.
  8. A medical certificate shall be furnished by the assessee from a doctor as defined in India Income Tax Act.

DEDUCTION IN RESPECT OF MEDICAL TREATMENT RELATING SOME SPECIFIED DISEASES (U/S 80DDB) DURING FINANCIAL YEAR 2015-16 ONWARDS

Every thing is same as mentioned in financial 2014-15 except one change. With effect from 01.04.15 the deduction under section 80DDB shall be allowed up to Rs.80000/= for a patient who is very senior citizen. Very senior citizen means who has completed 80 years in relevant financial year.

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