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Calculate the tax saved through Health Insurance

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Tax is an extremely important medium for the government to acquire funds to be invested. However, if you are paying the tax, then you may feel inclined to reduce your taxable income as much as you can within the confines of the law. Yes, there are numerous ways through which you can maximize the benefits of your medicalim policy. If you select the best health insurance suited for you from an excellent health insurance provider then you can enjoy a lot of benefits. The benefits would not only entail getting excellent health coverage but also aid in reducing your taxable income. Let’s see how:

How Health Insurance Can Save Tax?

According to the Indian Income Tax Act, you can avail a maximum of INR 25000 tax benefit from health insurance. However, the amount is inclusive of INR 5000 for preventive health checkup. It means that your taxable income can be reduced by INR 25000. Furthermore, the tax premiums paid by you not only includes your coverage but also dependents i.e. husband/wife and children. You will also be able to claim additional benefits if you were to take health insurance for your father and mother. However, they have to be senior citizens for you enjoy the benefits.

Calculating Tax Saved

The best way to understand how to save tax through health insurance is through an example. Consider that Mr. Rohan, aged 35, has made the following payments during the previous financial year:

  • Premium on medical insurance of INR 22500
  • Premium on medical insurance of INR 6000 for his wife.
  • Premium on medical insurance of INR 4500 for a dependent daughter.
  • Premium on medical insurance of INR 7500 for his elder daughter who is not dependent and is self-employed
  • Premium on medical insurance of INR 27000 each for his mother and father, who are senior citizens of India.
  • Preventive checkup expenditure worth INR 4500 for himself and his wife.

For the above scenario, Mr. Rohan will be eligible for deduction on the amount paid for himself, his wife, and dependent daughter. However, the amount cannot exceed INR 25000 according to Section 80D of the Indian Tax Act

  • However, he will not be able to claim deduction for his elder daughter as she is not a dependent.
  • The premium paid for the policy of his mother and father will be eligible for deductions. However, the amount cannot exceed INR 30000.
  • Furthermore, he can also claim deduction for the amount paid for preventive checkup but when combined with the premium paid for himself and his wife, the total deduction cannot exceed INR 25000.
Best Health Insurance Plans for You and Your Dependents

Now that you know how you can avail the maximum benefits from health insurance, ensure that you select the perfect mediclaim policy. Bharti AXA provides some of the plans not just for you but also for your dependents. Additionally, you will be able to enjoy various other benefits such as:

  • 24x7 service.
  • Quick claims and reimbursement process.
  • Applying for health coverage from the comfort of your homes.

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Disclaimer :The information published on this website is for the public's reference only. Content of this information is to provide an overview of your Insurance needs and should not be relied upon for personal, medical, legal or financial decisions and you should consult an appropriate professional for specific advice for Travel/Health/Motor. Bharti AXA General Insurance Company Limited makes no representations about the suitability, reliability, timeliness, and accuracy of the information, travel, services, or any other items mentioned on this subject for any purpose whatsoever.

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