LIC maturity claim whether taxable
This query is : Resolved
Yogesh Shah
(Querist)
30 August 2026
I am having HDFC life insurance endowment plan. The same will be matured in the month of Dec, 2026. Whether it is taxable. Kindly clarify the same.
30 August 2026
Dear Yogesh,
The maturity proceeds of your HDFC Life Endowment Plan maturing in December 2026 will generally be fully exempt from income tax under Section 10(10D) of the Income Tax Act, 1961, subject to the following conditions:
Premium-to-Sum-Assured Ratio:
If the policy was issued on or after April 1, 2012, the annual premium paid in any year during the policy term must not exceed 10% of the total minimum capital sum assured.
If issued between April 1, 2003, and March 31, 2012, the annual premium must not exceed 20% of the sum assured.
High-Value Policy Limit (Policies issued on or after April 1, 2023):
If the policy was issued on or after April 1, 2023, exemption applies only if the aggregate annual premium payable for all non-ULIP life policies does not exceed ₹5 Lakhs in any financial year. Any yield from policies exceeding this limit is taxable under Income from Other Sources.
TDS Applicability (Section 194DA):
If the policy fails the Section 10(10D) exemption criteria, TDS will be deducted at 5% on the income/net profit portion (Maturity Amount minus total premiums paid) if the total payout exceeds ₹1,00,000 in a financial year.
Death Claim Exception: If the maturity or payout is triggered by the death of the policyholder, the entire amount received by the nominee is 100% tax-free, regardless of premium limits.
The maturity proceeds of your HDFC Life Endowment Plan maturing in December 2026 will generally be fully exempt from income tax under Section 10(10D) of the Income Tax Act, 1961, subject to the following conditions:
Premium-to-Sum-Assured Ratio:
If the policy was issued on or after April 1, 2012, the annual premium paid in any year during the policy term must not exceed 10% of the total minimum capital sum assured.
If issued between April 1, 2003, and March 31, 2012, the annual premium must not exceed 20% of the sum assured.
High-Value Policy Limit (Policies issued on or after April 1, 2023):
If the policy was issued on or after April 1, 2023, exemption applies only if the aggregate annual premium payable for all non-ULIP life policies does not exceed ₹5 Lakhs in any financial year. Any yield from policies exceeding this limit is taxable under Income from Other Sources.
TDS Applicability (Section 194DA):
If the policy fails the Section 10(10D) exemption criteria, TDS will be deducted at 5% on the income/net profit portion (Maturity Amount minus total premiums paid) if the total payout exceeds ₹1,00,000 in a financial year.
Death Claim Exception: If the maturity or payout is triggered by the death of the policyholder, the entire amount received by the nominee is 100% tax-free, regardless of premium limits.
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