Life Insurance Plan: The Central Board of Direct Taxes (CBDT) has notified the Income Tax Act (Sixteenth Amendment), 2023. In this, Rule 11UACA has been prescribed for computing income in respect of amount received on maturity of life insurance policy.
Life Insurance Premium: Life insurance is also very important in people’s lives. People can also take maturity benefits and death benefits through life insurance. At the same time, a big update has come out regarding life insurance. In fact, the Income Tax Department has set rules for computing the income received from life insurance policy in case of annual premium of more than five lakh rupees.
life insurance
The Central Board of Direct Taxes (CBDT) has notified the Income Tax Act (Sixteenth Amendment), 2023. In this, Rule 11UACA has been prescribed for computing income in respect of amount received on maturity of life insurance policy. This provision is for those insurance policies in which the premium amount is more than five lakh rupees and such policies have been issued on or after April 1, 2023.
As per the Life Insurance
Amendment, for policies issued on or after April 1, 2023, tax exemption on maturity benefit under section 10(10D) will be applicable only if the total premiums paid annually on behalf of an individual Five lakh rupees. The amount received for premiums in excess of this limit will be added to income and taxed at the applicable rate.
Tax provision
Changes in tax provision in relation to life insurance policies except ULIP (Unit Linked Insurance Plan) were announced in the budget for the financial year 2023-24. Om Rajpurohit, joint partner (corporate and international tax), AMRG & Associates, said that as per the formula, any surplus amount received on maturity will be taxed under the category of ‘income from other sources’. The taxation provision for the amount received on the death of the life assured has not been changed and will be exempt from income tax as before.
