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Tax benefits under Section 80D, 80DD and 80DDB as per Budget 2015,with Automated HRA Exemption Calculator U/s 10(13A)

Complete guide income tax deductions under
sections 80D, 80DD and 80DDB which relate to medical expenses and health insurance/mediclaim.
Good understanding will help you in substantial tax savings. Every family has
regular medical expenses. This may be towards a health insurance premium, or
expenditure related to a family member’s disability/critical illness. The
Income Tax Act of 1961 has made provisions to reduce this burden through tax
deductions under section 80D, 80DD, 80DDB. Read on to understand how to use
these sections to your benefit
Section
80D
in Respect to Health Insurance Premiums Investments made
towards payment of health insurance premiums, qualify for a tax deduction under
section 80D. Available Deduction – For individuals less than 65 years of age,
amount of health insurance premium paid or Rs. 25,000/-, whichever is lesser.
For senior citizens above 65 years, amount of health insurance premium paid or
Rs. 30,000/-




Scope of
Deduction – Individual assesses can claim deduction for premiums paid towards
health insurance of self, spouse, parents and children. For HUF assesses,
premium paid for insuring the health of any member of the HUF, can be used for
deduction. Key Factors to keep in mind



1. The premium may be paid by any mode of
payment, other than cash.
2. The health insurance premium that you pay
must be from the taxable income applicable for the year you claim. Premiums
should not be from gifts received by you.
3. Part payment of premium is allowed. For
example, suppose your parents contribute 50% of their health insurance premium
and you pay the balance 50% of their premium. In such a case, you could avail
the deduction for the amount contributed by you and your parents too could
avail deduction for their contribution.




Section 80DD for Medical Treatment of Handicapped
Dependents






If you
are incurring expenditure for the treatment of your handicapped dependent, you
could claim a deduction under section 80DD.



Available Deduction – Rs 50000, or actual
expenditure incurred, whichever is lesser. For severe handicap conditions Rs.
1,00,000 is the deduction limit.





Scope of
Deduction – Deduction can be claimed for dependent parents, spouse, children
and siblings. Dependents must not have claimed any deduction for their
disability.


Deductions are permissible in either of the following
cases.




a)
Blindness and Vision problems



b) Leprosy-cured
c) Hearing impairment
d) Locomotor disability
e) Mental retardation or illness
Section
80 DDB for Treatment of Specified diseases
Costs incurred for treatment of specified
illnesses, could fetch you a tax benefit under section 80DDB.
Available Deduction – For individual assesses
less than 65 years of age, a deduction limit of Rs. 60,000 is applicable. For a
senior citizen, the limit is Rs. 80,000.

Scope of Deduction – Deduction is applicable
for treatment of self, spouse, children, siblings, and parents, wholly
dependent on you.




Diseases
covered



a) Neurological Diseases (where the disability
level has been certified as 40% or more).
b) Parkinson’s Disease c) Malignant Cancers
d) Acquired Immune Deficiency Syndrome (AIDS)
e) Chronic Renal failure
f) Hemophilia
g) Thalassaemia Key Factors




A certificate would be required from a
specialist working in a government hospital, as proof for the specified ailment.

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