Deductions Under Section 80D- Benefits & Works

section 80d limit

Meaning & Benefits of Section 80D:-

 A, Definition and key goals of section 80 D:-

Budget 2018 increased the deduction amount for parents who are above 60 from Rs 30,000 to Rs 50,000. In compliance with section 80D of the Income Tax Act of 1961, people may write off the cost of their health insurance premiums and preventative health screenings. If both the taxpayer and the parent(s) are 60 years of age or older, the maximum deduction is up to Rs 1 lakh.

B. Who is eligible for Section 80-D deductions?

Individuals and Hindu Undivided Families are allowed to deduct a variety of costs from their taxable income in accordance with Section 80D of the Income Tax Act of 1961.Under section 80D, an individual or HUF may claim tax advantages of up to Rs. 25,000 for insurance coverage for the individual, their spouse, and their dependent children.

C. Maximum amount that can be deduced from the taxable income:-

Health insurance is typically unavailable to anyone beyond the age of 80Even if money is spent on medical treatment, a deduction of up to ‘50,000 is permitted. You may only deduct up to $55,000 from your income under this clause. Additionally, you may claim preventive healthcare costs up to Rs. 5,000 for a preventative health check provided the total insurance premium you paid falls below the upper amount permitted.
(Source : www.iciciprulife.com)

D. What types or expenses qualify for deduction under these provisions?

Section 80D of the Income Tax Act of 1961 authorizes both individuals and Hindu Undivided Families (HUF) to deduct specific expenses from their taxable income. The price of yearly preventative health checks for oneself, one’s spouse, one’s dependent children, and one’s parents is also deductible, as are the premiums paid for health insurance. The 50,000-rupee deduction cap has been increased to 75,000 rupees starting in 2015–16. A certificate of disability from a recognised medical authority is needed in order to claim this deduction.

Allowing comparison with other similar sections:-

The premium on a life insurance policy that was paid by a taxpayer during the tax year may be deducted by the taxpayer, whether a person or a corporation, under section 80C. A deduction under section 80D must be made through non-cash transactions. Section 80C offers the chance to save tax by investing in schemes, which is the main distinction between section 80C and 80D deduction. The only expenses exempt from taxes under Section 80D are those related to health insurance.

Conclusions:-

As an investor, you may drastically lower your tax bills with the right information. Depending on the tax band of the person or HUF, a reduction in total taxable income by 150,000 might result in significant tax savings. Make judicious use of these investing alternatives to increase profits and lower tax obligations. Depending on the tax band of the person or HUF, a reduction in total taxable income by 150,000 might result in significant tax savings. Make judicious use of these investing alternatives to increase profits and lower tax obligations.

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