Lic
This query is : Resolved
13 May 2017
Sir one person have taken lic of rs 2000000 and till now he has paid premium rs 400000
So my query is how much amount should be shown in personal balance sheet as asset
So my query is how much amount should be shown in personal balance sheet as asset
13 May 2017
is the premium paid out of business funds or how..?
02 August 2024
When recording a Life Insurance Corporation (LIC) policy in a personal balance sheet, the value shown should reflect the current value or cash surrender value of the policy, not the premiums paid. Here’s how to handle it:
### **1. **Understand the Policy's Current Value**
- **Current Value:** The amount to be shown in the balance sheet is typically the **cash surrender value** of the policy, which is the amount you would receive if you were to terminate the policy early. This value is provided by LIC and can be obtained from the policy statement or by contacting LIC directly.
### **2. **Premiums Paid**
- **Premiums Paid:** The total premiums paid (₹400,000 in this case) do not represent the asset value. They are historical payments that contribute to the value of the policy but are not directly shown as an asset.
### **3. **Determine the Asset Value**
- **Cash Surrender Value:** If you have the cash surrender value, use this figure. If not, it is advisable to get this value from LIC to ensure accuracy.
### **4. **Record in Balance Sheet**
- **Asset Entry:** In your personal balance sheet, list the policy under assets with its current cash surrender value.
### **Example:**
Let’s say the cash surrender value of the LIC policy is ₹500,000. Here’s how you would record it:
- **Assets:**
- LIC Policy (Cash Surrender Value): ₹500,000
### **Summary**
To show the LIC policy on your personal balance sheet:
- **Obtain the current cash surrender value** from LIC.
- **Record this value** under assets on your balance sheet.
The premiums paid are important for understanding the investment in the policy but do not directly impact the asset value shown in the balance sheet.
### **1. **Understand the Policy's Current Value**
- **Current Value:** The amount to be shown in the balance sheet is typically the **cash surrender value** of the policy, which is the amount you would receive if you were to terminate the policy early. This value is provided by LIC and can be obtained from the policy statement or by contacting LIC directly.
### **2. **Premiums Paid**
- **Premiums Paid:** The total premiums paid (₹400,000 in this case) do not represent the asset value. They are historical payments that contribute to the value of the policy but are not directly shown as an asset.
### **3. **Determine the Asset Value**
- **Cash Surrender Value:** If you have the cash surrender value, use this figure. If not, it is advisable to get this value from LIC to ensure accuracy.
### **4. **Record in Balance Sheet**
- **Asset Entry:** In your personal balance sheet, list the policy under assets with its current cash surrender value.
### **Example:**
Let’s say the cash surrender value of the LIC policy is ₹500,000. Here’s how you would record it:
- **Assets:**
- LIC Policy (Cash Surrender Value): ₹500,000
### **Summary**
To show the LIC policy on your personal balance sheet:
- **Obtain the current cash surrender value** from LIC.
- **Record this value** under assets on your balance sheet.
The premiums paid are important for understanding the investment in the policy but do not directly impact the asset value shown in the balance sheet.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- CG Tax On residential property
- Post Office RD Interest
- Applicable TDS for Purchase of Flat from NRI
- Eway bill for machinery reparing
- Building and other construction workers welfare cess act 1996
- Claiming exemption of perquisite for employee-owned car under New Tax Regime in ITR-2
- ITR 3 FILING OF AN INDIVIDUAL (PARTNER IN A PARTNERSHIP fIRM)
- Gift of mutual fund units to daughter
- Reporting of STCG on Property in ITR
- NRI ITR2 account in 2025-26 ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,.
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- Difference in tax comparison report
- Gst invoice numbering and delivery challan numbering
- Sales amount in Gstr1
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
