Tax-Saving Tips When You Take Cancer Screening Tests

When it comes to maintaining good health, early detection of life-threatening diseases plays a crucial role. One of the most important preventive health steps is undergoing acancer screening test. These tests help in the early detection of cancer, which significantly increases the chances of successful treatment. What many people dont realize is that in addition to the health benefits, a cancer screening test may also provide some financial relief in the form of tax savings.

In India, the Income Tax Act offers deductions under specific sections for preventive health checkups, which include cancer screening tests. While your primary motivation for getting tested should always be your well-being, its worth understanding how you can also save money on taxes in the process.

1. Understand Section 80D of the Income Tax Act

Section 80D is one of the most beneficial tax-saving provisions for individuals who spend money on health insurance and preventive health checkups. This section allows deductions for premiums paid on health insurance policies and costs incurred for preventive checkups, which includes a cancer screening test.

Under this section:

• Individuals can claim up to ?25,000 per year for themselves, spouse, and dependent children.

• If the individual is a senior citizen, the limit increases to ?50,000.

• An additional ?5,000 is allowed within the ?25,000/?50,000 limit specifically for preventive health checkups such as a cancer screening test.

This means that the cost of your cancer screening test can be included in the ?5,000 preventive checkup limit, potentially reducing your taxable income.

2. Keep All Payment Receipts and Reports

To claim a deduction, it is essential to keep records. Ensure that the medical center provides you with a valid payment receipt and a copy of your cancer screening test report. The receipt should clearly mention the name of the test and the amount paid. If you pay in cash, make sure the receipt is dated and signed. However, digital payments are always preferable for clarity and easier tracking during tax filing.

3. Include Family Members Tests for Higher Deductions

Another way to increase your tax-saving potential is by undergoing cancer screening tests for your spouse, children, or parents. If you pay for their tests, you can include these expenses under the same ?5,000 limit. While the cap is fixed, maximizing this amount helps reduce your overall tax burden.

For instance, if you and your spouse both get a cancer screening test, the combined expense will likely reach the allowable limit, giving you the full benefit.

4. Digital Health Wallets and Tax-Saving Packages

Many diagnostic centers now offer preventive health packages that include cancer screening tests. These are often more cost-effective than individual tests and can be paid digitally. If you buy such a package, the entire amount, provided it includes a cancer screening test, is eligible for the Section 80D deduction under preventive checkups.

5. Tax Benefits Through Employer Health Benefits

If your employer offers annual preventive health checkups as part of your health benefits or wellness programs, and these include a cancer screening test, inquire if this is reflected in your Form 16 or salary breakup. While the amount might not come under your direct taxable income, ensuring your HR or finance department processes this correctly can still benefit you.

6. Use Flexible Benefits Plans (FBP)

Some companies offer Flexible Benefits Plans that allow employees to allocate a portion of their salary toward health expenses. If your organization provides such a benefit, you can include the cost of your cancer screening test here and reduce your taxable salary directly.

7. Plan Your Screening Early in the Financial Year

Instead of waiting until the end of the financial year, schedule your cancer screening test early. This way, you not only stay ahead of health risks but also spread out your expenses, making it easier to manage your finances and maintain proper documentation for your tax returns.

8. Know What Qualifies as a Preventive Health Checkup

A cancer screening test qualifies as a preventive health checkup when it is done to detect illness before symptoms appear. Screening tests such as mammograms, PAP smears, colonoscopy, and PSA tests fall under this category. Ensure the test is recognized as preventive and not part of treatment, which would fall under different tax provisions.

Conclusion

While the primary goal of a cancer screening test is to protect your health and catch any issues early, the Indian tax system also supports proactive healthcare through deductions. By being organized with documentation and understanding how Section 80D works, you can make your preventive healthcare efforts financially rewarding too.

A cancer screening test not only empowers you with the knowledge of your current health status but also helps in reducing your tax burden when used wisely. Whether for yourself or your loved ones, a timely cancer screening test ensures both physical and financial well-being. Make the smart choiceget tested, stay safe, and save on taxes.