Covid-19 has not only caused mental strain to people but has put many under financial stress given the steep cost of treatment. However, having medical insurance can ease this to an extent. Apart from this, there are certain tax deductions which you can claim against the expenses incurred for covid treatment which can help you bring down the tax liability.
If you are planning to file taxes don’t forget to claim these deductions.
Covid health insurance: You can claim a tax deduction of up to Rs25,000 under Section 80D against the premium paid for a health insurance policy. This includes a health insurance policy bought specifically to cover covid-19 related expenses.
"Apart from the medical insurance policies some of the policies are also launched by the insurance companies which covers only corona related expenses. Premium paid for those policies are also entitled for deduction under section 80D, provided that the premium should be paid by any other mode other than cash. Therefore, we can say that an Individual can claim deduction under section 80D in respect of insurance premium paid on corona-related insurance policy up to the amount specified in the said section," said Kapil Rana, founder & chairman, HostBooks Ltd.
In case you paid the premium for the health insurance policy of your parents, further deduction can be claimed. “In case the parents are 60 plus years of age an additional deduction of up to ₹50,000 can be claimed," said Sujit Bangar, Founder Taxbuddy.com. This can be claimed under Section 80D.
Financial help: In case a person has received financial help to meet medical expenses related to covid-19 from employer or any other person, the same will be tax exempt as per latest notification from the tax department. As per the notification, there is no upper limit on this. In case family members of an employee receive ex-gratia payment from an employer, it will be tax-free while in case of others payment up to ₹10 lakh will be tax-free.
