In the ever-evolving landscape of taxation, understanding the intricacies of new tax regimes is paramount for informed financial planning. Among the myriad considerations, health insurance is pivotal in ensuring fiscal responsibility and well-being. This exploration goes beyond the fiscal terrain, intertwining tax benefits with the critical aspect of safeguarding one’s family through comprehensive health coverage. **
The Union Budget 2023 introduced modifications to the tax regime implemented in the Union Budget 2020, making it the default slab for FY 2023–2024. Taxpayers opting for the new regime must forgo exemptions and deductions available under the previous system.
Allowable Tax Exemptions And Deductions
For Pensioners And Salaried Individuals
Individuals receiving a salary or pension can deduct Rs 50,000 under ‘Income from Salaries’. Under ‘Income from Other Sources’, family pensioners are eligible for a deduction of Rs 15,000 or 1/3rd of their family pension, whichever is less. **
80CCD (2)
Salaried individuals can claim a standard deduction of Rs 50,000 and include employer-contributed National Pension Scheme (NPS) funds under Section 80CCD (2). Private sector employees have a 10% salary limit for deductions, while government employees can claim up to 14%. **
Agniveer Corpus Fund
Contributions to the Agniveer Corpus Fund are deductible under Section 80CCH.
Section 80JJAA
Up to 30% of the cost of additional employees is deductible under Section 80JJAA.
Current Tax Exemptions
The new regime permits deductions for house loans, NPS, EPF, PPF contributions, savings plans, life insurance maturity amounts, and gratuities.
Retirement
Tax exemptions are available for retirement leave encashment, voluntary retirement benefits (up to Rs 5 lakh), education scholarships, retrenchment compensation, and demise benefits. **
Employer Allowances
Specific employer allowances, including travel and relocation allowances, commuted pensions, and gifts (up to Rs 5,000), are exempt from taxes.
Banned Exemptions And Deductions
House Loans
Deductions for interest and principal payments on housing loans, investments under Section 80C, and interest on student loan debt (Section 80E) are no longer permitted.
Charity
Donations and research-related expenses are not tax-deductible. Deductions under Section 80G for specific funds are disallowed.
Exemptions And Deductions Not Permitted
The new tax law eliminates up to 70 deductions, including house rent allowance, professional tax, travel allowance, conservatory fund deductions, and various Section 10 exemptions.
Integrating health insurance considerations adds a layer of holistic financial wellness to the tapestry of tax planning. Bajaj Allianz health insurance plans for families stand as exemplars, not just for their tax advantages but for the assurance they provide during medical exigencies. **
Moreover, the emphasis on timely health insurance renewals emerges as a crucial aspect, ensuring continuity in coverage and mitigating unforeseen medical expenses. The interplay between fiscal discipline, comprehensive health protection, and the commitment to regular health insurance renewals forms a resilient foundation for individuals and families.
As we traverse the landscape of tax regulations, these elements collectively contribute to a financial strategy that not only meets legal obligations but also prioritises the long-term well-being of loved ones, fostering financial stability and peace of mind. Claims are subject to terms and conditions set forth under the health insurance policy. * **
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*Standard T&C Apply
**Tax benefits are subject to change in prevalent tax laws.
Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.
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