It is that time of the year when the rush to save tax begins. Searching for the right option can be a complicated and dull task, which most of us just want to get done with.

But did you know that investing in the right option can give you more than just tax saving? Life insurance is one such option that helps you Save Tax & Get More!

Tax benefits offered under the Income Tax Act, 1961:

  • Section 80C:

    You can get tax benefits upto 46,350/-* on Life insurance premiums paid u/s 80C of the Income Tax act 1961. This deduction from taxable income can be claimed for an Individual or a HUF.

     

  • Section 10(10D):

  • The returns earned by you from Life Insurance policies are tax-free subject to conditions of Section 10(10D) of the Income Tax act 1961.
  • Please refer the table below to view the details of plans eligible under Section 80C of the Income Tax act 1961 and section 10(10D) of the Income Tax act 1961.

    Sections Product Category Available Online
    Section 80C & Section 10(10D)
    ICICI Pru Wealth Builder II ULIP Plan Yes - Buy now
    Section 80C, 80D ICICI Pru iProtect Smart Term Plan Yes - Buy now
  • Section 80D:

  • You can get tax benefits of upto 7725/-* towards health insurance premiums paid for Critical Illness benefit@ on ICICI Pru iProtect Smart - Life & Health Option & All-in-one Option u/s 80D of the Income Tax act 1961.

Please refer the table below to view the details of plans eligible under 80D of the Income Tax Act 1961.

Sections Product Category Available Online
Section 80D ICICI Pru iProtect Smart Term Plan with Health option Yes - Buy now
Section 80D ICICI Pru Heart/Cancer Protect Health Insurance Plan Yes - Buy now
  • Section 80CCC:

    You can get tax benefits on premium paid up to 1,50,000/- towards pension/retirement policies. However, if you surrender the plan, the pension/annuity received will be taxed as per the existing tax laws.

  • Section 10(10A):

  • 1/3rd of the payment that you receive under pension plan at the time of retirement is also tax free. This is known as commutation.
  • Please refer the table below to view the details of plans eligible under Section 80CCC of the Income Tax Act 1961 and 10(10A) of the Income Tax Act 1961.

    Sections Product Category Available Online
    Section 80CCC & Section10(10A) ICICI Pru Easy Retirement Retirement Plan Yes -  Buy now
  • Section 80CCE:

  • Under this section , the overall limit of deduction from taxable income to get tax benefits under Sections 80C, 80CCC and 80CCD(1) of the Income Tax Act 1961 is  1,50,000/-. Section 80CCE of the Income Tax Act 1961 is not a separate deduction.

You can invest in different life insurance products to save tax + get more. However, it is important to know under which slab your income falls.

Income tax slabs for Financial Year 2017-18

Select your Age Group
Income Tax Slab Individuals below the age of 60 years
Up to 2,50,000 Nil
2,50,001 to 5,00,000 5%
5,00,001 to 10,00,000 12,500 + 20% of income exceeding 5,00,000
Above 10,00,000 1,12,500 + 30% of total income exceeding 10,00,000
Income Tax Slab Senior Citizens (aged 60 years but less than 80 years)
Up to 3,00,000 Nil
3,00,001 to 5,00,000 5%
5,00,001 to 10,00,000 10,000 + 20% of total income exceeding 5,00,000
Above 10,00,000 1,10,000 + 30% of total income exceeding 10,00,000
Income Tax Slab Very Senior Citizens (aged 80 years and above)
Upto 5,00,000 Nil
5,00,001 to 10,00,000 20%
Above 10,00,000 1,00,000 + 30% of total income exceeding 10,00,000

Surcharge: 10% of the Income Tax, where income is more than Rs.50 lacs but upto 1cr.

15% of the Income Tax, where income is more than Rs. 1cr.

Education Cess: 3% of the total of Income Tax and Surcharge

  • Above rates does not include Surcharge and Cess.

    • No surcharge is applicable on income tax if income is upto 50 lakh.
    • 10% surcharge is applicable on income tax if income is 50,00,001 to 1,00,00,000
    • 15% surcharge is applicable on income tax if income is above 1 crore
    • 2% Education cess and 1% Secondary and Higher Education Cess is applicable on the income tax and applicable surcharge.
  • Tax rates and slabs are same for Male and Female as per above table

  • For individuals earning income below 3.5 lakhs, tax rebate of upto 2,500 under section 87A is available

 

Now, let’s examine the salary components of Ravi, Ramesh & Rahul to get a clear picture
  Particulars (.) Ravi Ramesh Rahul
  Annual Salary 5,00,000 10,00,000 15,00,000
  Less: Medical Reimbursement 15,000 15,000 15,000
  Less : Deduction u/s 80C 80,000 1,50,000 1,50,000
  Less : HRA deduction as per section 10(13A) 92,000 1,00,000 1,50,000
  Gross Taxable Income (GTI) 3,13,000 7,35,000 11,85,000
         
  Tax computation on GTI
  Up to 2,50,000 - - -
  2,50,001 to 5,00,000 3,150 12,500 12,500
  5,00,001-10,00,000 - 47,000 1,00,000
  Above 10,00,001 - - 55,500
A Total tax 3,150 59,500 1,68,000
B Less Rebate u/s 87A 2,500 - -
C 2% Education & 1% Secondary & Higher Education Cess on (A-B) 19.5 1,785 5,040
  Tax Payable (A-B+C) 670 61,285 1,73,040

 

In unit linked plans, the investment risk in the investment portfolio is borne by the policyholder.

Please note: The tax write-up above is for general understanding and reference. You will have to verify the facts, law and content with the prevailing tax statutes and seek appropriate professional advice before acting on the basis of the above information. Tax laws are subject to amendments from time to time. ICICI Prudential Life Insurance Company Limited expressly disclaims any liability to any person, if tax benefits stated above are denied to the customer.

Tax benefits of `46350/-*  & `7725/- is calculated at the highest tax slab rate of 30.9% (including Cess and excluding surcharge) on life insurance premium paid of Rs. 1,50,000 u/s 80C of the Income Tax Act 1961 and health premium of Rs.25,000 paid u/s 80D of the Income Tax Act 1961 respectively. Tax benefits under the policy are subject to conditions under Section 80C, 80D, 80CCC, 80CCE, 10(10A), 10(10D) and other provisions of the Income Tax Act, 1961. Goods and Services Tax and Cesses, if any, will be charged extra as per prevailing rates. The tax laws are subject to amendments from time to time. Please consult your tax advisor for details. For more details on risk factors, terms and conditions please read the sales brochure carefully before concluding a sale.

@Critical Illness Benefit is accelerated and not an additional benefit which means the policy will continue with the Death Benefit reduced by the extent of the Critical Illness Benefit paid. To know more, please refer the product brochure.ICICI Pru iProtect Smart: UIN - 105N151V01.

Unlike traditional products, Unit linked insurance products are subject to market risk, which affect the Net Asset Values & the customer shall be responsible for his/her decision. The names of the Company, Product names or fund options do not indicate their quality or future guidance on returns. Funds do not offer guaranteed or assured returns.

ICICI Pru Wealth Builder II: UIN-105L139V01
ICICI Pru Smart Life: UIN-105L145V01
ICICI Pru Easy Retirement: UIN - 105L133V01
ICICI Pru Heart/Cancer Protect: UIN 105N154V01.

W/II/1060/2016-17

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