The first step in setting up a solid financial plan is to make sure you have a sufficient health insurance plan. With the rising costs of medical procedures and medicines, it is very important to have a strong health insurance plan. In the absence of a good health insurance plan, your savings can be wiped out and can leave you in a financial disaster. Health insurance also has tax benefits attached to it, as the premium paid towards health insurance is tax deductible under
Section 80D. A deduction of up to Rs. 25,000 on health insurance premium paid is provided, and in case any of the insured are senior citizens a deduction of up to Rs. 30,000 is provided.
Section 80DD allows a taxpayer who bears medical expenses for a severely disabled dependent to claim a maximum deduction of Rs. 1,25,000.
Section 80DDB allows for a deduction of the expenses incurred while treating critical diseases, with a maximum deduction of Rs. 40,000 for individuals below the age of 60, Rs. 60,000 for individuals above the age of 60 years and Rs. 80,000 for individuals above the age of 80 years.
Section 80U allows the taxpayer to claim up to Rs. 75,000 as tax deductions in case the taxpayer them self is suffering from a disability and a maximum of Rs. 1,25,000 in case the taxpayer is suffering from a severe disability.
Expenses incurred for preventive health checkups up to Rs. 5,000 can be clubbed with the premium paid and can be claimed as a tax deduction under section 80D.