Results 1 to 3 of 3

Thread: How DTC affect Life Insurance Policies - old and new?

Hybrid View

Previous Post Previous Post   Next Post Next Post
  1. #1
    Administrator
    Join Date
    Apr 2009
    Location
    Chennai
    Posts
    255

    Exclamation How DTC affect Life Insurance Policies - old and new?

    You will pick up maximum wrong numbers when on roaming.

  2. #2
    Moderator Rahul's Avatar
    Join Date
    Feb 2009
    Location
    Delhi
    Posts
    386

    Exclamation

    1. Under New Direct Tax Code - You can save tax only for the premium of policies which gives a life cover of at least 20 times of the annual premium. If any life insurance policy is not met this condition you will not get tax exemption for the premium amount and also the income arise from the policy is taxable.
    2. At present life insurance policies are exempted under section 80C of income tax act and you can get exemption of Rs. 1,00,000 for life insurance and other tax free investments. But under New Direct Tax Code the maximum exemption limit is Rs. 50000 for life insurance, Tuition fee of children and Medical Insurance together.
    |Jargon Buster|Before you post, please read the FAQ and the sticky posts on the board you wish to use.|Blog|

  3. #3
    Super Moderator PolicyWala's Avatar
    Join Date
    Feb 2009
    Location
    New Delhi
    Posts
    675

    Default

    Quote Originally Posted by Madhura View Post
    How DTC (Direct Tax Code) affect Life Insurance Policies - old and new? Please explain with examples.
    All life insurance policies would be taxed on maturity as normal income, unless received on death of the life insured, or on maturity at the end of the policy (only if the premium payable in any year does not exceed 5% of the sum assured). Unfortunately, the amended law would apply to all insurance policy proceeds after 1 April 2010, irrespective of when the policy was taken. All existing policies maturing after that date would be affected.

    Also, if you are paying an annual life insurance premium and health insurance premium totalling at least Rs50,000, the deduction would be limited to Rs50,000 against the current available deduction limit of Rs1.15 lakh (1 lakh for life insurance premium and Rs15,000 for health insurance premium).

    The new DTC will be applicable only to Life Insurance policies taken after 1/04/2012 (or any other date as specified by Govt.) subject to the DTC will be passed by the Govt.. All the existing Life insurance policies continue to enjoy the tax benefits up to 1 Lac(As per the tax laws) till the completion of the policy term.


    Source - livemint.com

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •