Updated February 13th, 2024 at 17:57 IST
Health and wealth: Tax-saving tips – Insure your parents, boost workplace benefits
Claim tax deductions on parents' health insurance premiums under Section 80D: Rs 25,000 for those below 60, and Rs 50,000 for those above 60.
Parental coverage savings: Ever wondered about the intricacies of getting health insurance for your parents? You can meet their unique health needs while also tapping into tax-saving opportunities under Section 80D of the Income Tax Act, say experts.
"When it comes to insuring your parents, it's crucial to consider their unique health needs, including age, existing conditions, and medical history. Once you've identified these requirements, explore online health insurance options from reputable providers," said Sanjeeb Rout from National Insurance Company.
Look for policies designed specifically for parents, taking into account coverage details, terms, conditions, and premium costs. Once you've found a suitable policy, make the purchase in your parents' names.
Rout from NIC, emphasises the simplicity and efficiency of the online purchasing process. Upon policy issuance, the policy and tax receipt are promptly emailed to the policyholder.
Under Section 80D of the Income Tax Act, you can claim tax deductions on the premiums paid for your parents' health insurance. For parents below 60, the deduction limit is up to Rs 25,000, while for those above 60, it goes up to Rs 50,000.
Notably, the individual responsible for paying the premium is termed the proposer. Anyone can act as the proposer when purchasing a policy for parents, but only the proposer is eligible for tax benefits associated with premium payments.
Rout highlights that if you buy a senior citizen plan for your parents, you are considered the proposer, and premium receipts will be issued in your name. This allows you to take advantage of tax exemptions on premium payments, with a deduction limit of up to Rs 50,000 for insured individuals aged 60 or above.
Premium proof process
To claim tax benefits, maintaining a record of premium payments is crucial. Obtain a premium paid certificate from the insurer, including essential details like your name, premium amount, parents' names, policy number, and coverage period. Submit this documentation at your workplace to benefit from tax deduction savings.
Additionally, if your organisation allows reimbursement of health insurance premiums, you can claim these benefits at your workplace. If your corporate policy includes your parents, the company will cover the premiums.
Securing health insurance for your parents involves careful consideration of their health needs, thorough policy selection, and adherence to tax regulations. Detailed record-keeping ensures you can leverage tax-saving opportunities effectively.
Published January 29th, 2024 at 10:39 IST