New Delhi: Taxpayers opting for the old tax regime can significantly reduce their taxable income by claiming deductions under Section 80D of the Income Tax Act, 1961. This provision allows individuals to claim tax benefits on health insurance premiums paid for themselves, their family, and parents. However, this deduction is not available under the new tax regime.
With the financial year 2024-25 (Assessment Year 2025-26) closing soon, taxpayers must maximize their savings by utilizing Section 80D. Here’s how you can claim up to ₹1 lakh in tax deductions by investing in health insurance and medical expenses.
If you have purchased a health insurance policy or renewed your existing policy during FY 2024-25, you can claim a deduction under Section 80D while filing your Income Tax Return (ITR) under the old tax regime.
Taxpayers do not need to upload their policy documents while filing the ITR, but keeping them handy for verification is recommended.
Individuals Below 60 Years: Can claim up to ₹25,000 for premiums paid towards their own policy, spouse, and dependent children.
Senior Citizens (60 Years & Above): Eligible for a higher deduction of ₹50,000.
Additional Deduction for Parents:
If both the taxpayer and their parents are senior citizens (60 years & above), they can claim up to ₹1 lakh in deductions (₹50,000 for self + ₹50,000 for parents).
Additionally, a preventive health check-up deduction of ₹5,000 is included within the overall limit of ₹25,000 or ₹50,000, depending on the taxpayer’s age.
If a taxpayer incurs medical expenses for a senior citizen (aged 60 & above) who does not have health insurance, they can still claim up to ₹50,000 as a deduction under Section 80D.
Investing in health insurance not only ensures financial protection but also provides substantial tax benefits. As the March 2025 deadline approaches, taxpayers under the old tax regime should leverage Section 80D to maximize savings while securing health coverage for themselves and their families.