When you buy a health insurance policy in India, the premium you pay includes a Goods and Services Tax (GST).
GST on Health Insurance Premiums
- GST Rate: ✅ 18%
- This is applied on the base premium amount (not the final sum insured).
🔍 Example:
If your base premium is ₹10,000, the GST would be:
- 18% of ₹10,000 = ₹1,800
- Total premium payable = ₹11,800
Key Points to Note
- ✅ You can still claim the full premium (incl. GST) under Section 80D of the Income Tax Act — the GST amount is included in the tax deduction.
- ❌ You cannot claim GST refund on health insurance (unlike businesses with input tax credit on goods/services). Health insurance is treated as a personal expense, so no GST input credit is allowed for individuals.
- 📊 For companies or businesses purchasing group health insurance, input tax credit (ITC) may be allowed if the insurance is a contractual obligation under labor laws or employment contracts.
Always check if the GST is mentioned separately in your premium receipt. It makes tax filing easier and ensures you're claiming the right 80D deduction amount.