Proceeds From LIC

This query is : Resolved

CA Nitin Wadhwani (Querist)
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30 August 2008 author : deepak garg
Posted On : 8/29/2008 12:05:34 PM
Hello,
Everybody , can Friends u tell me what are the provisions are relateds regarding Int. Rev. From FD and Sum Recived on Maturity of LIC Thanks In Advance

Expert : CA Hemant T Dewani
Posted On : 8/29/2008 12:31:13 PM
if interest received on fd is taken on accrual basis then it is taxable on those years when you are declared your income othere wise it is taxable wneh you are receved cash
lic matured is not taxable it is exempt u/s 10 of the act

Expert : Mohit Vats
Posted On : 8/29/2008 2:39:06 PM
Mr. Hemant,

LIC maturity amount is taxable if the person who take the policy get the amount...
But in case the LIC paid the amount of insurance that is not taxable....

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Expert : SANDEEP AGGARWAL
Posted On : 8/29/2008 4:46:53 PM
LIC MATURITY AMOUNT IS NOT TAXABLE IT IS EXEMPT. ONLY IN CASE OF PENSION FUND PENSION AMOUNT IS TAXABLE

REGARDS,
SANDEEP AGGARWAL

Correct Answer:

Proceeds From LIC Are Exempt Under Sec.10(10)(d) except in three cases illustrated below:

1.If Amount is received on a keyman insurance policy.
2.if amount is received from a pension policy.
3.if premium paid is more than 20% of sum assured in any year.

Late CA Sampat Jain

Late CA Sampat Jain (Expert)
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30 August 2008 (10D) any sum received under a life insurance policy, including the sum allocated by way of bonus on such policy, other than—

(a) any sum received under sub-section (3) of section 80DD or sub-section (3) of section 80DDA*; or

(b) any sum received under a Keyman insurance policy; or

(c) any sum received under an insurance policy issued on or after the 1st day of April, 2003 in respect of which the premium payable for any of the years during the term of the policy exceeds twenty per cent of the actual capital sum assured:

Provided that the provisions of this sub-clause shall not apply to any sum received on the death of a person:

Provided further that for the purpose of calculating the actual capital sum assured under this sub-clause, effect shall be given to the 74[Explanation to sub-section (3) of section 80C or the Explanation to sub-section (2A) of section 88, as the case may be].

Explanation.—For the purposes of this clause, “Keyman insurance policy” means a life insurance policy taken by a person on the life of another person who is or was the employee of the first-mentioned person or is or was connected in any manner whatsoever with the business of the first-mentioned person;]

CA Nitin Wadhwani

CA Nitin Wadhwani (Querist)
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31 August 2008 Answer Is Copied From The Act.
No Knowledge Is Applied By The Expert.
I Have Not Asked Any Question.
I Have Also Given The Answer Only.