Service Tax on Insurance Premium

Dear Friend,

The service tax is payable at the rate of 10%(+2% cess) on risk premium OR 1%(+2% cess)on total premium. It is an option given to insurance co.

This option is not available if the entire premium is towards risk premium- For Ex: term insurance policy.

If the premium includes both risk premium and premium for savings, then company based on the working of actuary makes the bifurcation.

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The increase in rate form 10% to 12% applicable wef the date on which Finance Bill get the assent of Persident of India.


TONY. M.P. , THRISSUR,   KERALA
94470 80631
trc_mptony @ sancharnet.in