REGARDING TAXABILITY OF ULIPs

This query is : Resolved

Quick Summary

If a Unit Linked Insurance Policy (ULIP) purchased in 2003 is surrendered in 2024 before maturity, the surrender value will be taxed as income from other sources. Crucially, the exemption under Section 10(10D) for premiums exceeding Rs. 2,50,000 is not applicable in this scenario, nor do Long Term Capital Gains provisions apply.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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15 July 2025 If Unit linked insaurance policy has been purchased in the year of 2003 and the policy has been surrendered in the year 2024 before its maturity then what would be its taxability?
And if the amount of premium exceeds Rs. 2,50,000 then exemption upto Rs. 2,50,000 shall be available under section 10(10D)?

Nabin Agarwal

Nabin Agarwal (Expert)
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15 July 2025 No 10(10D) exemption is available on Maturity or Death.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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15 July 2025 So the amount of Surrender value and premium paid shall be taxable under LTCG u/s 112A and exemption of Rs. 2,50,000/- shall not be available?

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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12 August 2025 The surrender value in 2024 will be taxable as income from other sources.
No exemption under Section 10(10D).
LTCG provisions do not apply.

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