Budget 2024 Section 80D Exemption: Why govt should increase Section 80D tax exemption limit under old tax regime
Section 80D of the Income-tax Act of 1961 allows for the deduction of certain medical expenses and premiums for health insurance policies from your taxes. The limit under section 80D has remained unchanged for the past several years. Taxpayers who have opted for the old tax regime are hoping for an increase in the limit under section 80D in the upcoming Budget scheduled for July 2024, considering the significant rise in healthcare costs.
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«India faces a severe issue with inadequate insurance. When a family's primary earner passes away, the money left for the survivors to live and settle debts is usually less than nine percent of what's actually needed. Changing tax sections 80C and 80D to provide separate tax breaks for the life-threatening risk part of term life plans could help close the gap in death risk coverage and enhance social security,» said Satishwar B., MD and CEO, Bandhan Life.
What is the current 80D limit?
Under Section 80D, medical insurance premiums for non-senior and senior citizens can be deducted from taxes up to Rs 25,000 and Rs 50,000. A Rs 5,000 deduction for costs incurred for prophylactic medical examinations is also included in this cap. The individual, spouse, and dependent children must pay the premium. An additional tax deduction can be claimed for parents' health insurance premiums.
Do note that an individual will not be able to claim this deduction if one chooses the new income tax regime, i.e., this
