ICICI prudential Premier life insurance policy (unit linked) has matured approx Rs 15 Lakhs. There is no sum assured as mentioned in the policy. There was an option to opt for 1/3rd commutation and balance as annuity. However as per advice of the agent, the client has opted for the whole amount.
No tds has been deducted. The premiums paid were 490000(2007), 100000(2008) and 100000(2009).
How will the amount of 15L received be taxed?
"Commutation of pension on vesting date is tax free under section 10(10A) of the Income Tax Act,1961, amount received on surrender, as pension is taxable as income."
The maturity proceeds as a whole is exempt u/s. 10(10A), because invested in annuity product.
Now the pension amount will be taxable, so finally it is taxed on withdrawal and not over transfer to pension plan.
As per the terms of the policy, it seems only 1/3rd tax-exempt. But when no TDS amount deducted, treat it as exempted u/s 10(10D).
For the same icici premier life unit linked policy, 1% tds have been deducted. so does that mean that whole amount is taxable or 1/3 amount is tax exempted.
2) Are all ulip policies tax exempted.
plz clarify
for better analysis, may refer ....
THANK YOU VERY MUCH SIR.
CAclubindia
