Keyman Insurance Policy

Dear Gunjan,

Sum received on Key man Insurance policy is charged to tax as follows -

1) As Salary - If sum is received by Employee

2) As PGBP - If sum is received by Employer

3) As Othersources - If sum is received by any family member of the employee and where there is no employer-employee relationship

Dear aamir. Thank u. but i need more details.

Suppose an employer hv taken keyman insurance policy for his employee and he get resigned/retired after 3 years, then who can claim for policy amount?

Plz reply...

Dear Gunjan,

Keyman Insurance Policy have 3 things -

1) Owner

2) Insured

3) Benificiary

Now these 3 people can be same or can be diffrent, it depend upon the type of policy. So Tacxabitily will be in the hands of the person who receives it.

PLz go through this article - I am sure most of ur doubts will be setteled -  

https://www.bcasonline.org/articles/artin.asp?427

Completely agree with Amir bhai................

Incase of Keyman Insurance Policy......

Sum received by employee - Salary.....

Received by Employer - Business Income.....

Received by Family member of employee - Other sources....

It will be taxable in the hands of Receipient...........