Income Tax Deduction for Medical Expenses

Narendra Kumar

04 Sep, 2019

The provision of Income Tax has provided relief to its taxpayer in certain limit and condition for medical expenses incurred for them. It is pertinent to note that medical facilities are basic facilities to be provided by Government to its taxpayer though as being developing countries government can’t afford us free health facility but the tax provision for Tax Deduction for Medical Expenses has granted relief on it.

Healthcare is a major concern of family and holds significant family budget on it too. It includes treatment, preventive checkups, and health insurance premiums. Now let’s discuss section-wise available deduction in Income Tax for such healthcare cost:

Section 80D: Deduction in respect of health insurance premium

Assess (taxpayer) being Individual or HUF whether resident or non-resident claim deduction on payment of health insurance^[1].

In case of Individual:-

1. The whole of the amount paid to insurance for health including preventive health checkup of himself or his family does not exceed Rs. 25,000/-
2. The whole of the amount paid to insurance on health including preventive checkup of parents of assessed does not exceed Rs. 25,000/-
3. The whole of the amount paid on account of medical expenditure incurred on the health of assessor any member of his family does not exceed Rs. 30,000/- and
4. The whole of the amount paid on account of medical expenditure incurred on the health of any parent of the assessee does not exceed Rs. 30,000/-

To claim clause (c) or (d) must be paid in respect of very senior citizen.

Further clause (a) and (c) or clause (b) and (d) shall not exceed Rs. 30,000/-.

If any preventive health checkup payment is included in (a) and (b) the deduction of such amount shall be allowed to the extent it does not exceed in total Rs. 5K.

The same treatment is given for HUF also.

Section 80DD: Deduction for medical treatment of a dependant who is a person with a disability

Assess being Individual or HUF incurred any expenditure for medical treatment including nursing along with maintenance expenditure if incurred any during the previous year, the person will be allowed to claim a deduction of Rs. 75,000/- on this account provided the expenses is done for dependent having a disability.

If the disability is severed one then the amount of deduction will be Rs. 1, 25,000/- instead of Rs. 75,000/- as per the provision of income tax law.

Section 80DDB: Deduction in respect of Medical Treatment

Assess being individual or HUF resident in India actually paid any amount for medical treatment of disease or ailment for himself or dependent (in case of Individual) or for any member of HUF (in case of HUF) allowed a deduction of the amount actually paid or the sum of Rs. 40,000/- whichever is less subject to a prescribed set of rules and regulation of Income Tax Law.

Also, Read: HUF, a Way to Save Income Tax.

Section 80U: Deduction for Persons with Disability

Any resident Individual having certified copy of disability from the approved medical authority at any time during the previous year shall be allowed deduction of Rs. 75,000/- in computing of total income of him/her. If the disability is severely defined as per provision of law then the amount of deduction of Rs. 75,000/- be substituted with Rs. 1, 25,000/-.

It is thumb rule of Income Tax provision that the person enjoying the benefit in one particular section can’t claim benefit in other section. For example, access enjoying entitled benefit u/s 80DD can’t claim again the deduction u/s 80U.