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Taxability of lic maturity amount

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Querist : Anonymous

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Querist : Anonymous (Querist)
18 October 2016 Dear All
Plz confirm weather maturity amount received from LIC is taxable or not however i had also claimed the deduction of premium paid to LIC u/s 80C for this policy,

Thanks
Vinay Thakur

18 October 2016 As per Section 10(10D) the LIC Maturity amount is exempt from tax if it fulfills following condition

1. If Policy issued before April 1, 2003 Than all amount received as maturity will me exempt from tax.
2. If Policy issued on or after April 1, 2003 and before April 1, 2012 Than exemption available only when annual premium is not more than 20% of sum assured.
3. If Policy issued on or after April 1, 2012 and before April 1, 2013 Than exemption available only when annual premium is not more than 10% of sum assured.
4.If Policy issued on or after April 1, 2013 Than exemption available only when annual premium is not more than 10% of sum assured (For Normal Person)
4A.If Policy issued on or after April 1, 2013 Than exemption available only when annual premium is not more than 15% of sum assured
(1.A person with disability or a person with severe disability as referred in section 80U or
2.Suffering from disease or ailment as specified in the rules made under section 80DDB)
Hope your doubt clear.
Thanks.

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Querist : Anonymous

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Querist : Anonymous (Querist)
18 October 2016 Sir what is the effect of sec 80U and 80DDB
In respect of taxability of maturity amount
received from LIC




18 October 2016 It is related to disability only and for disable person only.
Thanks.

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Querist : Anonymous

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Querist : Anonymous (Querist)
21 October 2016 Dear sir,
Assume if sec 80U & 80DDB is not applicable to policy holer. Actaully he had taken two policy one in 2006 and another is in 2011 however the policy which was taken in 2006 the annual preminum of the policy was exeed 20% of its maturity amount and policy which was taken in 2011 the annual premium of this said policy was less then 20% of its maturity amount. In this scenario pls clarify weather maturity amount of first policy which was taken in 2006 will be fully taxable and maturity amount of second policy pertain to 2011 will be fully exempt,

Pls guide,

21 October 2016 It is not relates to Maturity Amount But it is related to Sum Assured please check the sum assured.
Thanks.

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Querist : Anonymous

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Querist : Anonymous (Querist)
21 October 2016 Sir. What is sum assured

21 October 2016 It is written in your policy (in simple terms it is assurance amount provided by LIC for any Life incident happens.)
Otherwise first you contact your agent and find the sum assured amount and than check the % of premium.
Thanks.




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Querist : Anonymous

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Querist : Anonymous (Querist)
22 October 2016 Yes. First policy's annual premium is
Exceed 20% of its sum assured but
Second policy's annual premium is
Less then 20% of its sum assured
Amount in this scenario weather
First policy's maturity amount will
be fully taxable and second policy's
maturity amount will be fully exempt

22 October 2016 In case the premium payable in any year exceeds the prescribed percentage i.e. 10%, 15% or 20% of actual sum assured, as described in the preceding paragraphs, then the whole proceeds from the policy would get taxed in the year of receipt. However, in case of death of the insured, where his nominees receive the policy proceeds the same shall be tax free in the hands of the nominee(s) even if premium paid in any year crossed the prescribed percentage of sum assured.
Means your First policy maturity amount would be Taxable and Second Policy amount would be Exempt U/s 10(10D)
Thanks.



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