Taxpayers who wish to file their income tax return (ITR) under the old tax regime must utilise these last few weeks of March 2025 to the fullest. One of the ways to maximise your tax savings strategy is to utilise Section 80D of the Income Tax Act, 1961. Under Section 80D you can claim a tax deduction for paying health insurance premium for yourself, your family, and parents.
What is Section 80D tax deduction?
If you purchased a health insurance policy or paid the renewal premium in FY 2024-25 (AY 2025-26) then you can claim tax deduction under Section 80D. You need to keep the policy document handy and claim this deduction while filing the income tax return (ITR) under the old tax regime. Do note you don’t need to upload the policy document.
Here’s how much income tax deduction is available under Section 80D:
- If you are below 60, you can claim an income tax deduction of up to Rs 25,000.
- Senior citizens can claim an income tax deduction of up to Rs 50,000.
- If you pay health insurance premiums for your parents, you can claim an additional tax deduction of Rs 25,000 if they are below 60 years or 50,000, depending on their age.
If you are below the age of 60, you can claim up to Rs 25,000 deduction for paying health insurance premium. The health insurance policy can be taken for coverage of policyholder, his/her spouse and their dependent children.
An additional deduction for insurance (premium) for parents is available up to Rs 25,000 if they are less than 60 years of age. If the parents are 60 years old or above, the deduction amount could go up to Rs 50,000. So in a scenario where you are 60 years or above and your parents are also 60 years and above, then you can claim up to Rs 1 lakh as tax deduction under Section 80D if you are paying health insurance premium for yourself and parents.
A deduction of Rs 5,000 is allowed for preventive health checkups. However, this deduction of Rs 5,000 is limited to the umbrella limit of Rs 25,000 or Rs 50,000 depending upon the age.However, if you are not paying any amount in respect of a senior citizen to effect or to keep in force an health insurance of such person then you can claim up to Rs 50,000 in aggregate on account of medical expenditure.
| Particulars | Maximum tax deduction for self and family | Maximum tax deduction for parents | Maximum total tax deduction under Section 80D |
| Self and family (all below 60 years of age) | Rs 25,000 | – | Rs 25,000 |
| Self, family and parents (all below 60 years of age) | Rs 25,000 | Rs 25,000 | Rs 50,000 |
| Self and family (below 60) and parents (above 60 years of age) | Rs 25,000 | Rs 50,000 | Rs 75,000 |
| Self, family and parents (all above 60 years of age) | Rs 50,000 | Rs 50,000 | Rs 1,00,000 |
| HUF or Hindu Undivided Family (all members below 60 years of age) | Rs 25,000 | Rs 25,000 | Rs 25,000 |
| HUF (at least one member is above 60) | Rs 50,000 | Rs 50,000 | Rs 50,000 |
Example for calculation of Section 80D tax deduction
Ram (57 years) is a taxpayer. Other members of his family are Sita (55 years old, Ram’s wife), Lav and Kush (dependent children), and his senior citizen parents. The following expenditures incurred by Ram for FY 2024-25:
| Particulars | Ram, Sita, Lav & Kush | Senior citizen Parents |
| Medical insurance premium paid by cheque | 22,000 | – |
| Medical Expenditure paid by cheque | – | 47,000 |
| Medical Expenditure paid by cash | 7,000 | 5,000 |
| Preventive health-check-up | 8,000 | 4,000 |
Source: Tax2win
Particulars | Ram, Sita, Lav & Kush | Parents |
Medical insurance premium paid by cheque | Rs 22,000 | – |
Medical Expenditure paid by cheque | – | Rs 47,000 |
Medical Expenditure paid by cash | Not eligible since available for senior citizen, for whom medical policy not taken | Not allowed cash expenses. |
Preventive health-check-up | 3,000(maximum limit is 25,000 since 22,000 is utilized, only 3,000 can be claimed ) | 2000(maximum limit is 50000 since 47,000 utilized, remaining 3000. However, preventive health check-up has an overall limit of 5,000, out of which 3,000 are used for self and family, so only 2,000 can be claimed now) |
Total 80D deduction that Ram can claim is Rs 74,000 | 25,000 | 49,000 |
Source: Tax2Win Source Link
