Are you looking to save taxes and invest in your health? Section 80D of the Income Tax Act, 1961 can help you do just that! This section offers deductions for the money you spend on maintaining your health and health insurance. It's important for your tax planning and personal finance, so let's dive in!
Under Section 80D, you can claim a deduction for money spent on health insurance policies for yourself, your spouse, and dependent children. You can also claim a deduction for money spent on healthcare for your parents. The deduction amount varies based on the age of the insured and the type of policy. Here's a breakdown:
If you're below 60 years of age, you can claim a maximum deduction of up to Rs. 25,000 for yourself, your spouse, and dependent children, and up to Rs. 25,000 for your parents. This means a total deduction of up to Rs. 50,000 per year.
If you're above 60 years of age, the maximum deduction increases to Rs. 50,000 for yourself, your spouse, and dependent children, and up to Rs. 50,000 for your parents. This means a total deduction of up to Rs. 1,00,000 per year.
You can also claim an additional deduction of up to Rs. 5,000 for preventive healthcare expenses.
Let's look at an example to see how much tax you can save by investing in health insurance for yourself and your parents. Suppose your annual salary is Rs. 13 lakhs, and you pay a health insurance premium of Rs. 20,000 for yourself and Rs. 40,000 for your parents. Here's how much tax you can save under Section 80D:
Deduction for yourself, spouse, and dependent children: Rs. 20,000
Deduction for parents: Rs. 50,000 (since they're above 60 years of age)
Total deduction: Rs. 70,000
Now, let's calculate how much tax you would have paid without this deduction. Based on your salary, your tax slab is 30%. Therefore, your taxable income would be Rs. 13,00,000. This means you would have paid Rs. 2,10,000 as income tax. However, with the deduction of Rs. 70,000 under Section 80D, your taxable income reduces to Rs. 12,30,000. This means you would now pay Rs. 181,500 as income tax, saving Rs. 28,500 in taxes!
Investing in health insurance not only ensures your well-being but also helps you save on taxes. So why wait? Get a health insurance policy for yourself and your parents and start reaping the benefits of Section 80D today!
Book an appointment with us through https://calendly.com/mrinal-bafna-insurance-specialist/15min to understand more about the benefits .You can reach out to us at info@ckpinsurance.in or +91 9920099273.
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