how to show Maturity amount received from Life insurance in ITR | Section 10(10D)| Sadak
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This sum is exempt under section 10 (10 DA) provided ,
1.)Annual premium paid must not exceed 10 % of sum assured for policy taken after April 1 , 2012
2.) For policy between April 1,2003 to 31st March 2012 , premium must not exceed 20 % of sum assured
The amount received at the time of maturity of the policy is exempt from tax in the hands of the policyholder. Neither any Income tax nor any TDS is deductible on such amount received.
If an individual receives the maturity amount from a relative, it would be exempt in the hands of the individual if the policy taken by the Individual’s relative was in the Individual’s name.
For example- Mr. A receives Rs.5 lakhs from a relative. The relative had taken life insurance policy in his name, therefore the proceeds received by Mr. A would still be exempt from tax.
In the case of death of a person any sum received will be exempt.
The maturity proceeds received are exempt under Section 10(10D) and should be shown under exempt income of the income tax return.
Situations when Life Insurance Proceeds may become taxable
The following sums received from a life insurance policy are taxable as ‘Income from other sources’:
1.)Any sum received from a policy under section 80DD(under a medical insurance policy)
2.)Any sum received under a Keyman Insurance Policy
3.)If the premium paid for a policy on or after 01/04/2012 exceeds 10% of the actual sum assured, the entire amount received under such policy shall become taxable*
4.)If the premium paid for a policy on or after 01/04/2003 but on or before 31st March,2012 exceeds 20% of the actual sum assured, the entire amount received under such policy shall become taxable
Cheers,
Amlan Dutta
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