I had surrendered my insurance pension policy valued Rs.315000, out of which i received a credit of Rs.210000 in my account and balance was reinvested in another policy, but tds 1% was deducted for the whole surrender amount. For ITR filing what is the taxable income amount.
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Tax exemption on insurance pension plan
Replies (8)
Check the terms of the policy. Prima facie, 1/3rd of the surrender amount should be tax-exempt.
Mr. dhiraj... for academic purpose and to enlighten me only , I'm asking this don't take it otherwise... under which section 1/3rd of surrender amount is exempted
Some pension policies are framed having tax benefit as per sec10(10A) of IT act..
But exact tax liability differ with different products; here this is just an estimate.
Refer: https://www.caclubindia.com/forum/maturity-amount-of-policies-469226.asp
thanks for clarification Mr. dhiraj
sir, thanks for your kind reply.my doubt is since part of the maturity amount is reinvested, whether the whole maturity amount to be taken as taxable income or the only the amount received in bank. plz clarify
Exact clarification would be available from the insurer, or from the scheme details document. Without referring the details it would be difficult to give any reply.
Generally, the amount reinvested in annuity gets exempted, while 1/3rd of the maturity value of pension scheme is commuted pension and hence exempted. Remaining part is only taxable. But get confirmation from insurer company's helpline &/or website.
very kind of you.. thanks for your response
Most Welcome, Dear ..
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