80D
This query is : Resolved
20 December 2010
Hello Sir,
can you explain what is rules and regulation of 80D (medical reinforcement)
can you explain what is rules and regulation of 80D (medical reinforcement)
20 December 2010
Sec 80D:-
Eligible Assesses
Individuals and Hindu Un-divided Family (HUF) only
Scope
* Health Insurance Premium paid under a scheme framed by any other insurer and approved by the Insurance Regulatory & Development Authority (IRDA).
Mode of Payment
The premium may be paid by any mode of payment other than cash.
Deduction under Section 80 D of the Income Tax Act, 1961
* For senior citizens i.e an individual resident who is of the age of 65 years or more at any time during the relevant previous year: The amount of heath insurance premium paid or20,000, whichever is less.
* For non-senior citizens: The amount of health insurance premium paid or15,000, whichever is less.
Who can be covered
* For an individual: Premium paid for insuring the health of the individual, his or her spouse, parents and children.
* For a HUF: Premium paid for insuring the health of any member of the family.
Let us now understand the computation of the deduction with the help of a simple example # :
An individual assesses pays (through any mode other than cash) during the previous year health insurance premium as under:
1.12,000 to keep in force an insurance policy on his health and on the health of his wife and children
2.17,000 to keep in force an insurance policy on the health of his parents.
Under the proposed new provisions, he will be allowed a deduction of27,000 (Rs. 12,000+15,000) if neither of his parents is a senior citizen. However, if any of his parents is a senior citizen, he will be allowed a deduction of29,000 (Rs. 12,000 +17,000).
Eligible Assesses
Individuals and Hindu Un-divided Family (HUF) only
Scope
* Health Insurance Premium paid under a scheme framed by any other insurer and approved by the Insurance Regulatory & Development Authority (IRDA).
Mode of Payment
The premium may be paid by any mode of payment other than cash.
Deduction under Section 80 D of the Income Tax Act, 1961
* For senior citizens i.e an individual resident who is of the age of 65 years or more at any time during the relevant previous year: The amount of heath insurance premium paid or20,000, whichever is less.
* For non-senior citizens: The amount of health insurance premium paid or15,000, whichever is less.
Who can be covered
* For an individual: Premium paid for insuring the health of the individual, his or her spouse, parents and children.
* For a HUF: Premium paid for insuring the health of any member of the family.
Let us now understand the computation of the deduction with the help of a simple example # :
An individual assesses pays (through any mode other than cash) during the previous year health insurance premium as under:
1.12,000 to keep in force an insurance policy on his health and on the health of his wife and children
2.17,000 to keep in force an insurance policy on the health of his parents.
Under the proposed new provisions, he will be allowed a deduction of27,000 (Rs. 12,000+15,000) if neither of his parents is a senior citizen. However, if any of his parents is a senior citizen, he will be allowed a deduction of29,000 (Rs. 12,000 +17,000).
20 December 2010
Section 80D is available other than 100000 deduction available under 80C for life insurance,ppf,gpf,tuition fee,ULIP,House loan repayment etc.
Insurer covered:This deduction is available for medical claim policy which should be framed in this behalf by
by GIC(General insurance Corporation) or by
any other insurer but approved by IRDA(Insurance Regulatory Development authority)
Available to :Deduction is available to
Individual (resident or non resident ,Indian Citizen or foreign citizen)
HUF(Hindu undivided Family may be resident or non resident)
Mode of payment:Insurance Premium should be paid by any mode other than by Cash .Means if insurance premium is paid by cash then no deduction is available.Before Assessment year 2008-09 ,only payment by cheque was allowed under this section but from Ay 2008-09 onwards the deduction is allowed by other mode also like online payment which is now a days is very popular or by credit card is also allowed.
Out of Income :The amount should be paid out of the income chargeable to tax.
Proposer of the policy is not must:The premium is to be paid to effect or keep inforce insurance policy ,there is no condition that assessee should be the proposer of the policy ,
Partly contribution: Assessee can partly contribute the premium amount but amount should be paid directly to insurance company and paid through mode other than by cash (see example)
Insurance cover on?:First deduction given below :Insurance Premium may be paid for medical claim insurance policy for assessee himself or spouse or dependent children or any combination of three.
Addition for parents:Second deduction given below:Insurance premium may be paid for medical claim insurance for assessee parents (father or mother or for both)
Amount Of deduction : Two type of Deductions are available to Individuals under this section from Assessment year 2009-10
Deduction on Medical insurance premium paid for himself,spouse,dependent children =Rs 15000 maximum.
Deduction on Medical insurance premium paid for parents ,whether dependent on assesee or not =Rs 15000 maximum
Deduction to HUF: Deduction to HUF is available on insurance premium paid for policy taken for of any member of the HUF
Addition deduction for Resident Senior Citizen:In addition to two point above, additional deduction of Rs 5000 is available where assessee or his spouse (wife or husband) or dependent parents or any member of the family in case one and father or mother is a resident in India and a senior citizen in case two.And same in the case of HUF assessee if policy has been taken on member which is senior citizen than additional Rs 5000/- deduction is available also to HUF.
Senior citizen means who is at least of 65 year of age or more at any time during the previous year.
Example : An individual assessee pays (through any mode other than by cash) during the previous year medical insurance premium as under
Rs 12000/- to keep in force an insurance policy on his health and on his wife and dependent children
Rs 17000/- to keep in force an insurance policy on the health of his parents.
According to above provisions he will be allowed of Rs 27000/-(12000/- +15000/-) if neither of his parents is senior citizen .however if any of his parent is a resident senior citizen ,he will be allowed a deduction of 29000(12000+17000) .whether the parents is dependent or not is not a consideration for deciding the deduction under section 80D.
Further, in the above example ,if cost of insurance on the health of the parents is 30000/- out of which Rs 17000/- is paid (by any non cash mode) by the son and rs 13000/- by the father (who is senior citizen), out of their respective taxable income ,the son get the deduction of Rs 17000/- (in addition to deduction of Rs 12000/- for the medical insurance on self and family) and the father will get deduction under section Rs 13000/-
Insurer covered:This deduction is available for medical claim policy which should be framed in this behalf by
by GIC(General insurance Corporation) or by
any other insurer but approved by IRDA(Insurance Regulatory Development authority)
Available to :Deduction is available to
Individual (resident or non resident ,Indian Citizen or foreign citizen)
HUF(Hindu undivided Family may be resident or non resident)
Mode of payment:Insurance Premium should be paid by any mode other than by Cash .Means if insurance premium is paid by cash then no deduction is available.Before Assessment year 2008-09 ,only payment by cheque was allowed under this section but from Ay 2008-09 onwards the deduction is allowed by other mode also like online payment which is now a days is very popular or by credit card is also allowed.
Out of Income :The amount should be paid out of the income chargeable to tax.
Proposer of the policy is not must:The premium is to be paid to effect or keep inforce insurance policy ,there is no condition that assessee should be the proposer of the policy ,
Partly contribution: Assessee can partly contribute the premium amount but amount should be paid directly to insurance company and paid through mode other than by cash (see example)
Insurance cover on?:First deduction given below :Insurance Premium may be paid for medical claim insurance policy for assessee himself or spouse or dependent children or any combination of three.
Addition for parents:Second deduction given below:Insurance premium may be paid for medical claim insurance for assessee parents (father or mother or for both)
Amount Of deduction : Two type of Deductions are available to Individuals under this section from Assessment year 2009-10
Deduction on Medical insurance premium paid for himself,spouse,dependent children =Rs 15000 maximum.
Deduction on Medical insurance premium paid for parents ,whether dependent on assesee or not =Rs 15000 maximum
Deduction to HUF: Deduction to HUF is available on insurance premium paid for policy taken for of any member of the HUF
Addition deduction for Resident Senior Citizen:In addition to two point above, additional deduction of Rs 5000 is available where assessee or his spouse (wife or husband) or dependent parents or any member of the family in case one and father or mother is a resident in India and a senior citizen in case two.And same in the case of HUF assessee if policy has been taken on member which is senior citizen than additional Rs 5000/- deduction is available also to HUF.
Senior citizen means who is at least of 65 year of age or more at any time during the previous year.
Example : An individual assessee pays (through any mode other than by cash) during the previous year medical insurance premium as under
Rs 12000/- to keep in force an insurance policy on his health and on his wife and dependent children
Rs 17000/- to keep in force an insurance policy on the health of his parents.
According to above provisions he will be allowed of Rs 27000/-(12000/- +15000/-) if neither of his parents is senior citizen .however if any of his parent is a resident senior citizen ,he will be allowed a deduction of 29000(12000+17000) .whether the parents is dependent or not is not a consideration for deciding the deduction under section 80D.
Further, in the above example ,if cost of insurance on the health of the parents is 30000/- out of which Rs 17000/- is paid (by any non cash mode) by the son and rs 13000/- by the father (who is senior citizen), out of their respective taxable income ,the son get the deduction of Rs 17000/- (in addition to deduction of Rs 12000/- for the medical insurance on self and family) and the father will get deduction under section Rs 13000/-
20 December 2010
Agree with the above experts.
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