Health Insurance Tax Benefits in India: Section 80D Explained
Learn about health insurance tax benefits under Section 80D in India. Find out the current limits, why they need to be increased, and how the government could improve these benefits in the upcoming Budget 2025.
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Health insurance helps pay for medical bills when someone in your family gets very sick. Because medical costs are getting higher, it’s important for every family to have health insurance. To encourage people to buy health insurance, the government gives a tax benefit on the money you spend on health insurance. But the current limit for this benefit is too low, and many people and insurance companies are asking the government to increase it. Experts hope that the new Budget 2025, which will be announced on February 1, will make this change.
What is the Tax Benefit under Section 80D?
Under Section 80D, you can get a tax benefit for health insurance. If you are under 60, you can get up to ₹25,000 for insurance covering you and your family. If you are over 60, the benefit increases to ₹50,000. If you also have health insurance for your parents, you can get an extra ₹25,000 if they are under 60, or ₹50,000 if they are over 60. So, you can get up to ₹1 lakh in total as a tax benefit.
When Was This Last Changed?
The last time the government changed this rule was in 2015. They raised the limit from ₹15,000 to ₹25,000. In 2018, they also raised the benefit for senior citizens' insurance policies from ₹30,000 to ₹50,000. But since then, nothing has changed, and people are hoping the government will raise the limit this year.
Why Do People Want the Limit Increased?
Medical costs have been rising, especially after the COVID-19 pandemic. Many people feel that the current tax benefit isn’t enough, particularly if they have young children or elderly parents. Many families still don’t have health insurance, and insurance companies believe that raising the benefit limit will encourage more families to get insured. Experts also think the government could improve the tax system by including this benefit in the new rules. After the pandemic, people are worried about future health issues, and experts say it’s the government’s responsibility to ensure everyone can afford health insurance.
