Caring for the health of parents will make individual tax payers eligible for rewards from the taxman starting next fiscal.
In his Budget speech, Finance Minister P Chidambaram said that individuals who pay for the medical health insurance of their parent or parents would be given further tax exemption.
According to the proposal, an individual tax payer would be allowed an additional deduction of up to Rs 15,000 on any payment made for the health insurance for his or her parents.
"I propose to allow an additional deduction of Rs 15,000 under Section 80D to an individual who pays medical insurance premium for his/her parent or parents," Chidambaram said.
The amendment in this regard would be effective from April 1.
Under the proposed new section, whether the parents are dependent or not, is not a consideration for deciding the deduction.
Further, the government has proposed that if either of the individual tax payer's parents, who has been medically insured, is a senior citizen, the deduction would be allowed up to Rs 20,000.
According to the proposed norms, the deduction would be in addition to the existing deduction available to the individual on medical insurance for himself, his spouse and dependent children.
