Tax Benefits on Mediclaim Health Insurance Premium

Section 80DD

Deduction under this section is available to an individual who:
• Incurs any expenditure for the medical treatment, training and rehabilitation of a disabled dependant or deposits any amount in schemes like Life Insurance Corporation for the maintenance of a disabled dependant. An annuity or a lump sum amount is paid to the dependant or to a nominee for the benefit of the dependant in the event of the death of the individual depositing the money, from the said scheme
• A deduction of Rs 50,000 is available. Where the dependent is with a severe disability, a deduction of Rs 1,00,000 is allowed. (As per AY 2009-10)
• If the death of the dependant occurs before that of the assessee, the amount in the scheme is returned to the individual and is taxable in his hands in the year that it is received.
• An individual should furnish a copy of the issued certificate by the medical board constituted either by the Central government or a state government in the prescribed form, along with the return of income of the year for which the deduction is claimed.
• The term 'dependent' here refers to the spouse, children, parents and siblings of the assessee who are dependent on him for maintenance and who themselves haven't claimed a deduction for the disability in computing their total incomes.
• This deduction is also available to Hindu Undivided Families (HUF).

Section 80DDB

• An individual, resident in India spending any amount for the medical treatment of specified diseases affecting him or his spouse, children, parents, brothers and sisters and who are dependent on him, will be eligible for a deduction of the amount actually spent or Rs 40,000, whichever is less.
• Note - For the complete list of disease specified, refer to Rule 11DD of the Income Tax Rules.
• For any amount spent on the treatment of a dependent senior citizen an individual is eligible for a deduction of the amount spent or Rs 60,000, whichever is less is available.
• The individual should furnish a certificate in Form 10-I with the return of income issued by a specialist working in a government hospital.
• If any amount of medical expenditure is borne by the employer or is reimbursed under an insurance scheme, the eligibility of the deduction is the reduction to that extent. This deduction is also available to Hindu Undivided Families (HUF).