80D is Now Section 126: Health Insurance Deduction Rules for FY 2026-27
QUICK ANSWER
Section 80D of the old Income-tax Act, 1961 — which lets you deduct health insurance premiums from your taxable income — is now Section 126 of the Income-tax Act, 2025, effective 1 April 2026. Nothing about the limits or conditions changed in the renumbering: up to ₹25,000 for your own family’s premium, a separate ₹25,000 for your parents’ premium, both rising to ₹50,000 when senior citizens (60+) are insured — for a combined ceiling of ₹1,00,000. The deduction is available only in the old tax regime. Premiums must be paid in non-cash mode; only the ₹5,000 preventive health check-up allowance can be paid in cash.
The new section number first
If you have read the old law, “80D” is one of those numbers you just know. Under the Income-tax Act, 2025, it now lives at Section 126. The words of the provision were carried over as they were — the rewrite renumbered the section, not the rules. So every 80D guide you have read still describes the right limits; only the citation changed. For FY 2026-27 (AY 2027-28) filings, quote Section 126; for FY 2025-26 (AY 2026-27), the old number 80D still applies.
What 80D / Section 126 covers
The deduction has three parts. Most people know only the first one and leave money on the table.
1. Health insurance premiums. Premiums you pay for a policy covering you, your spouse, your dependent children, and/or your parents. This includes employer-group top-ups you buy and pay for yourself, and CGHS or other notified government health-scheme contributions (up to ₹25,000 for your own family).
2. Preventive health check-ups. Up to ₹5,000 a year for check-ups of yourself, your spouse, your dependent children, or your parents. This sits inside the overall limit, not on top of it — and it is the only 80D expense you are allowed to pay in cash.
3. Medical expenses for uninsured senior citizens. If your parents are 60 or older and have no health insurance policy at all, the actual medical bills you pay for them — doctor visits, medicines, hospitalisation, diagnostics — qualify within the same ₹50,000 parents’ bucket. This was built for the real-world problem that insurers price many senior citizens out of coverage.
The limit table
| Who is covered | Maximum deduction |
|---|---|
| Self, spouse, dependent children (all below 60) | ₹25,000 |
| Self, spouse, dependent children (any insured person 60 or older) | ₹50,000 |
| Parents (both below 60) | ₹25,000 |
| Parents (either parent 60 or older) | ₹50,000 |
The two buckets are separate — they stack. A 35-year-old salaried person who insures their own family (₹25,000) and their senior-citizen parents (₹50,000) can claim up to ₹75,000. The ₹1,00,000 combined ceiling applies only when you are 60+ yourself and also insure 60+ parents.
A detail worth knowing: the senior-citizen test is whether the person is 60 or older at any time during the financial year. Someone turning 60 in February 2027 counts as a senior citizen for the whole of FY 2026-27.
What changed vs what stayed the same
What changed: the section number (80D → 126) and the form in which you file. That is all.
What stayed the same: every number and every condition above.
Two conditions still catch people out:
- Payment mode. Premiums must be paid by any mode other than cash — UPI, net banking, card, cheque, demand draft. A cash premium is disallowed completely. Only the ₹5,000 preventive check-up can be paid in cash.
- Whoever pays, claims. The deduction goes to the person who actually paid. If your parents pay their own policy premium, they claim the deduction — you cannot claim it even if they are dependent on you.
Practical impact: where the real savings are
Senior parents are the biggest lever. The parents’ bucket jumps from ₹25,000 to ₹50,000 the moment either parent turns 60. For a 30% slab filer, that extra ₹25,000 of deduction is ₹7,500 of real tax saved.
Uninsured parents still count. If your 78-year-old mother was denied insurance because of a pre-existing condition, keep every medical receipt — consultations, medicines, tests — and claim up to ₹50,000 of actual expenditure. You need itemised bills and non-cash payment records; the Act does not spell out the documents, but this is what assessing officers ask for.
Split a mixed premium. If your term life plan has a health rider, only the health-rider portion qualifies under 80D; the life-cover part belongs to 80C (now Section 123). Ask your insurer for the split in writing — policy schedules carry it.
Top-ups count. Your employer’s group health cover costs you nothing, so there is nothing to claim. But a personal top-up or super-top-up you buy yourself qualifies fully.
Spread multi-year premiums. Pay two or three years’ premium in one go and the deduction is spread proportionally across the years covered — not claimed entirely in the payment year.
Regime choice matters
80D is a Chapter VI-A deduction, and it is not available in the new tax regime (Section 202). If you have senior parents and a ₹75,000 80D claim, switching to the new regime quietly costs you around ₹22,500 of tax saving at the 30% slab — factor that in before you opt out of the old regime with Form 10-IEA.
A worked example
Take a 34-year-old salaried person in the 30% slab, filing under the old regime. They pay ₹22,000 a year for their own family floater and ₹48,000 a year for their 65-year-old parents’ policy. The self bucket gives ₹22,000 (premium is below the ₹25,000 cap) and the parents’ bucket gives ₹48,000 (below the ₹50,000 senior cap). Add a ₹3,000 cash-paid preventive check-up — it fits inside the self bucket’s leftover ₹3,000 space. Total 80D deduction: ₹73,000, worth about ₹22,700 in tax saved. If this person had switched to the new regime, that entire ₹22,700 would have been left on the table.
Common mistakes to avoid
Claiming the same premium twice. If both spouses split the parents’ premium, only the person who actually paid each rupee can claim that portion. One expense, one claimant — keep the payment trail clean if you share the cost.
Claiming for parents-in-law. The parents’ bucket covers your own parents, not your parents-in-law. Premiums paid for in-laws do not qualify.
Assuming the employer cover is yours. Your company’s group health insurance costs you nothing, so there is no premium to claim. Only what you personally paid — your own policy, a top-up, or your parents’ policy — is deductible.
Forgetting the regime. Every year, people buy health insurance for the tax saving and then file under the new regime, where 80D is disallowed. Decide the regime before you count the benefit.
FAQ
What is the new section number for 80D in the Income Tax Act, 2025?
Section 80D of the 1961 Act is now Section 126 of the Income-tax Act, 2025, effective 1 April 2026. The limits and conditions are unchanged — only the number moved. Quote Section 126 for FY 2026-27 filings.
Is the 80D deduction available in the new tax regime?
No. 80D (now Section 126) is a Chapter VI-A deduction and is disallowed entirely in the new tax regime. You can claim it only if you file under the old regime.
Can I pay the health insurance premium in cash and still claim 80D?
No. Premiums must be paid by a non-cash mode — UPI, net banking, card, cheque, or demand draft — or the whole deduction is disallowed. The sole exception is the ₹5,000 preventive health check-up expense, which may be paid in cash.
Is the ₹5,000 preventive health check-up deduction in addition to the ₹25,000 limit?
No. The ₹5,000 is a sub-limit within the overall ₹25,000/₹50,000 ceiling, not over and above it. It is useful when your premium is less than the ceiling — it fills the leftover space.
Can I claim 80D for my parents if they pay their own premium?
No. The deduction goes to whoever actually paid. If your parents pay their own policy, they claim it on their return. You can only claim premiums you paid for your parents’ policy.
How much can I claim for senior citizen parents without health insurance?
Up to ₹50,000 of actual medical expenditure — doctor consultations, prescribed medicines, hospitalisation, diagnostic tests — provided no health insurance policy covers them during the year. Payment must be non-cash and you should keep itemised receipts.
Official Sources
- Income-tax Department — incometaxindia.gov.in (bare Act text and CBDT circulars)
- e-Filing portal — incometax.gov.in (regime selection and return filing)
- India Code — indiacode.nic.in (Income-tax Act, 2025, Section 126 text)
Reviewed by Asuthod Rathod, CA · Last updated: 13 October 2026
Disclaimer: This article is general information, not tax advice. Section numbers and limits are per the Income-tax Act, 2025 as published; confirm applicability to your facts with a qualified professional before filing.
Editorial byline for eircicai tax saving guides — covering 80C investments, ELSS, PPF, NPS, and regime comparison. Content is reviewed by Asuthod Rathod, CA.