Section 80D

Section 80D of the Income-tax Act allows an Indian taxpayer to claim a deduction from taxable income for health insurance premiums paid for self, spouse, children, and parents, subject to specified ceilings. The benefit is available only under the old tax regime; taxpayers who have opted for the new regime under Section 115BAC cannot claim Section 80D. The ceilings are structured by age cohort.

A taxpayer below 60 can claim up to ₹25,000 a year for premiums paid for self, spouse, and dependent children, and an additional ₹25,000 for premiums paid for parents below 60 — taking the combined ceiling to ₹50,000. If the parents are 60 or older ('senior citizens' for tax purposes), the ceiling for the parents' portion is ₹50,000, and if the taxpayer themselves is 60 or older, the self-family ceiling also rises to ₹50,000 — taking the combined ceiling to ₹1,00,000. Within the 80D limit, up to ₹5,000 can be claimed for preventive health check-ups (the check-up component need not be paid by mode other than cash; only the main premium must be paid by non-cash mode).

Worked example: Priya, 45, salaried, opts for the old regime. She pays ₹18,000 for her family floater and ₹32,000 for her parents' senior-citizen health policy, plus ₹3,500 for the family's annual preventive check-up. Her 80D deduction is ₹25,000 (family floater capped at 25k, though she paid less — she only claims ₹18,000 + ₹3,500 for check-up = ₹21,500, within the ₹25,000 limit) plus ₹32,000 for parents (capped at ₹50,000 since parents are seniors) — total ₹53,500 deducted from taxable income, saving roughly ₹16,700 at her 31.

2% effective slab. A common misconception is that Section 80D applies to life insurance premiums. It does not — life insurance premiums fall under Section 80C.

Section 80D is only for health insurance premiums, preventive check-ups, and medical expenditure for senior-citizen parents who are uninsured (a separate sub-clause). Another common misconception is that the deduction is available regardless of how the premium is paid. The premium must be paid by any mode other than cash (netbanking, cheque, card, UPI), except the preventive check-up sub-item of ₹5,000 which can be in cash.

Keep the premium receipt and the policy schedule as proof in case the return is scrutinised. Related: Section 80C, Section 10(10D), new tax regime.