Tax Benefits of Life Insurance Policy
Tax Benefits
of Life Insurance Policy
of Life Insurance Policy
Tax laws are subject to amendments made to them from time to time. Please consult your tax advisor for details, before taking any decision based on the following information.
Tax Saving Life Insurance Plans
Life insurance policies are useful tax planning tools because the policyholder is eligible for tax benefits under the Income Tax Act, 1961. There are multiple modes for saving tax, but life insurance is one of the most effective tax planning instruments.The taxpayer can claim a deduction under Section 80C for the premium paid towards the life insurance policy and proceeds received under the policy are exempt subject to conditions prescribed under Section 10(10D) of the Income Tax Act, 1961. Deductions are available for policies taken in the names of taxpayers, their spouse, and their children.
With ICICI Prudential Life Insurance Plans, you can not only save tax but also look at achieving your long-term goals and get financial protection to secure the future of your loved ones.
How to save income tax with Life Insurance Plans?
Under the Income Tax Act, 1961 you can save tax on your hard-earned money by using our Life Insurance Products and solutions. You can get tax advantages at different stages of the policy.
Stage 1: Entry Advantage
– You receive tax benefits on your premium payments under Section 80C (life insurance), Section 80CCC (pension) and Section 80D (health).Stage 2: Earnings Advantage
– Your investment with us gets the potential to grow and is not currently taxable~.Stage 3: Exclusive Switching Advantage
– You can switch between equity, debt and balanced funds anytime and these switches are not taxable~.Stage 4: Exit Advantage
– The proceeds you receive on maturity under the policy are exempt subject to conditions under Section 10(10D) of the Income Tax Act, 1961
Tax benefits^ offered under the Income Tax Act, 1961:
Section 80C:
You can claim a deduction from your taxable income on account of the premium paid towards life insurance for self, spouse or children. You will be allowed a maximum deduction of up to `1.5 lakh.
Section 10(10D):
The proceeds received under the policy are exempt subject to conditions under Section 10(10D) of the Income Tax Act, 1961.
Details of plans eligible for tax benefits under Sections 80C and 10(10D):
| Sections | Product | UIN | Category | Available Online |
|---|---|---|---|---|
| Sections 80C & Sections 10(10D) |
||||
| ICICI Pru Signature | 105L177V07 | ULIP Plan | Yes - Check Premium |
Section 80CCC:
You can get tax benefits on premiums 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 the plan at the time of retirement is exempt where you are entitled to receive gratuity and 1/2 in other cases.
Section 80D:
You can get tax benefits on premiums paid in any mode, other than cash towards health insurance policies taken for yourself, your spouse, your dependent children and your parents. The maximum tax benefits under Section 80D are as follows:- You can get deduction up to ₹ 25000 under Section 80D for yourself and your family (₹ 50000 if age of insured is 60 years or above) and up to ₹ 25000 (₹ 50000 if age of insured is 60 years or above) for your parents.
Section 80CCE:
Under this section, the overall limit of deduction from taxable income to get tax benefits under Sections 80C, 80CCC and 80CCD(1) is 1,50,000/-.
Tax* benefits for single premium insurance policies
Tax* benefits under life insurance are also extended to policies with a single premium. You can claim a deduction under Section 80C* up to ₹ 1.5 lakh per annum. Further, the maturity proceeds from a single premium life insurance policy are exempt subject to conditions prescribed under Section 10(10D)* if the minimum sum assured throughout the policy term is at least ten times the amount of the annual base premium.
COMP/DOC/Apr/2023/104/2749
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