How Section 80D works
§80D allows deduction of medical insurance premiums paid for self, spouse, dependent children, and parents. Two separate caps:
| Bucket | Cap (none senior) | Cap (any senior 60+) |
|---|---|---|
| Self + family (spouse + dependent kids) | ₹25,000 | ₹50,000 |
| Parents | ₹25,000 | ₹50,000 |
| Combined max | ₹50,000 | ₹1,00,000 |
Preventive health checkup: ₹5,000 per year, counted within the above caps (not on top).
Old regime only — disallowed in the new regime.
Worked example — typical Indian filer
You (40yo, non-senior) + spouse + 2 kids on one health-insurance policy: ₹22,000 premium. Parents (senior, both 65+): ₹35,000 premium. Preventive checkup at year-end: ₹5,000.
- Self+family bucket: ₹22K premium + ₹3K preventive (fills to cap) = ₹25K
- Parents bucket: ₹35K premium + ₹2K preventive = ₹37K (under ₹50K senior cap)
- Total 80D deduction: ₹62,000
Mistakes to avoid
- Cash payment for premium — disqualifies the deduction
- In-laws’ premium — not eligible (only biological parents)
- Premium paid in advance for multiple years — claim only the year-applicable portion (one premium can’t be claimed twice)
- Group insurance from employer — only the portion you pay (deducted from salary) qualifies. Employer-paid portion is already a non-taxable perquisite.
Bridges
- Income tax calculator — feed the 80D deduction here
- Old vs new regime calculator — quantify regime difference