Term Insurance is a pure protection plan that offers coverage against an unfortunate event during the policy term. One of the most significant advantages of a term plan is the tax^ benefit associated with it. Term Insurance tax^ Benefits can provide you with increased savings and better earnings. Read on to know more.
Term Insurance Tax Benefits^ under Specific Sections of the Income Tax Act, 1961
As mentioned above, there are several term insurance tax benefits^ that you can avail of. Following are a few of them:
Tax^ Benefits under Section 80C
- The premiums you pay towards your term insurance plan can help you save money in the present as a tax^ benefit. You can get deductions of up to ₹ 1.5 lakh under Section 80C.Tax^ Benefits under Section 10(10D)
- The tax^ benefits are also extended to the death benefit given to the nominee. When there is an unfortunate event, the family receives the policyholder’s death benefit or sum assured, which ensures that the family gets the necessary financial protection it requires, without losing out on taxes.Tax^ Benefits under Section 80D
- A deduction of up to ₹ 25000/-^ is also available under Section 80D on premiums paid for term plans with a critical illness cover option.
Eligibility criteria to claim tax^ benefit:
A deduction can only be claimed by individuals and a Hindu Undivided Family (HUF) on the premiums being paid for their term plans or on the benefits received by them.
1. How can I maximise term insurance tax^ benefits?
2. What will happen if I do not pay the premium on time?
3. Who is eligible to claim term insurance premium tax benefit?
The policyholder and the nominee can claim the term insurance tax^ benefit under Section 80C, Section 80D, and Section 10(10D) of The Income Tax Act, 1961.
4. Do I need to pay GST^ on term insurance under Section 80C?
5. Are there any situations when the beneficiary might still have to pay tax?
1. Benefits received under Section 80DD(3) are taxed
2. Benefits received under a Keyman insurance policy are also taxed
COMP/DOC/Apr/2023/244/2847
6. Will I continue to receive tax^ benefits if I discontinue the term insurance policy?
1. How can I maximise term insurance tax^ benefits?
2. What will happen if I do not pay the premium on time?
3. Who is eligible to claim term insurance premium tax benefit?
The policyholder and the nominee can claim the term insurance tax^ benefit under Section 80C, Section 80D, and Section 10(10D) of The Income Tax Act, 1961.
4. Do I need to pay GST^ on term insurance under Section 80C?
5. Are there any situations when the beneficiary might still have to pay tax?
1. Benefits received under Section 80DD(3) are taxed
2. Benefits received under a Keyman insurance policy are also taxed
COMP/DOC/Apr/2023/244/2847
6. Will I continue to receive tax^ benefits if I discontinue the term insurance policy?
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