Due to a amendment to section 80D, preventive health check up is allowed as a income tax deduction from financial year 2012-2013 on-wards. As per section 80D, an individual is eligible for tax deduction on the amount spent for preventive health check up for self, spouse, dependent children or parents.
Deduction Limit For Preventive Health Check Up – Section 80D
As per section 80D, tax deduction for preventive health check up should not exceed the limit of Rs.5,000. This means, if you are spending more than Rs.5000, then your deduction under section 80D will be restricted to Rs. 5000. If you are spending less than Rs.5000, then actual amount spent will be allowed as tax deduction.
Section 80D deals with tax deduction for payment of medical insurance premium. It clearly specifies that to get eligible for income tax benefits you are required to make your payment in any mode other than cash.
However, for Payment of preventive health check up, section 80D allow you to make your payments in any mode including cash. This means, you can pay through credit card, NEFT, debit card, cash or any other mode.
However, tax deduction of Rs. 5000 for preventive health check up is included in the overall limit of section 80D i.e. Rs. 25,000. If you are paying medical insurance premium of Rs. 25,000 or more then you cannot claim Rs. 5000 as tax deduction for preventive health check up as you already crossed the overall limit.
Similarly, if you are not crossing the limit of 25, 000 rupees then the difference amount (i.e. 25,000 minus the amount paid towards insurance) will be eligible for income tax deduction for preventive health check up but it will be restricted up to the maximum limit of Rs. 5,000.
Under section 80D, if you are paying premium for a senior citizen then deduction will be Rs. 30,000 instead of Rs. 25,000. Preventive health check up eligibility for senior citizen will be within this higher bracket of Rs. 30,000 instead of Rs. 25, 000.
If medical insurance premium is paid for your parents, then in addition to the above limit, you will also be eligible for additional deduction up to Rs. 25,000 in case your parents are not senior citizen.
If they are senior citizens then the deduction under section 80D will be Rs. 30,000 instead of Rs. 25,000. Benefit of Rs. 5000 for preventive health check up of your parents will also be part of this overall limit of Rs.25, 000 or Rs.30, 000 as the case maybe.
To claim tax deduction under section 80D for health check up expenses, you are required to collect bills from the hospital and produce it to your employer at the year end.
Non-salaried person has to keep the bill with them and are not required to submit it along with income tax return. In case required, bills are to be produced to assessing officer on demand.
For better understanding let us look into following Illustrations:-
Mediclaim insurance premium paid: – Rs. 10,000;
Preventive heath check-up expense: – Rs. 7,000
Tax benefit under Section 80D Rs. 10,000 + Rs. 5,000 = Rs. 15,000
Mediclaim insurance premium paid: Rs. NIL;
Preventive health check-up expense: Rs. 8,000
Tax benefit under Section 80D: Rs. NIL + Rs. 5,000 = Rs. 5,000
Mediclaim insurance premium paid: Rs. 23,000
Preventive heath check-up expense: Rs. 4,000
Tax benefit under Section 80D: Rs. 23,000 + Rs. 2,000 = Rs. 25,000
In above illustrations, we have assumed that insurance premium and charges paid for health check up is not for a senior citizen.