Income-tax (2nd Amendment) Rules, 2022

Last updated: 21 January 2022

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The Central Board of Direct Taxes has issued the Income Tax (2nd Amendment) Rules, 2022. These rules introduce a new method for calculating capital gains on specified unit-linked insurance policies (ULIPs). The amendment clarifies how to determine taxable gains when amounts are received from these policies, including bonus allocations, considering premiums paid.

MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) New Delhi, the 18th January, 2022 Notification No. 8/2022-Income tax G.S.R. 24(E). -In exercise of the powers conferred by sub-section (1B) of section 45, read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:- 1. Short title and commencement. -(1) These rules may be called the Inco

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3499

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4999

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FAQ :

These rules amend the Income-tax Rules, 1962, and introduce a new rule (8AD) for calculating capital gains on specified unit-linked insurance policies.

The rules come into force from the date of their publication in the Official Gazette.

Capital gains are calculated by subtracting the total premium paid to date from the first amount received, including any bonus.

For subsequent receipts, capital gains are calculated by subtracting the premium paid (excluding amounts already considered) from the amount received (excluding amounts already considered for tax).

A 'specified unit linked insurance policy' refers to any unit linked insurance policy mentioned in sub-clause (c) of clause (14) of section 2 of the Income-tax Act.

The capital gains computed under these rules are deemed to arise from the transfer of a unit of an equity-oriented fund set up under an insurance company's scheme comprising unit-linked insurance policies.

Notification No : 8/2022-Income tax
Source : https://www.incometaxindia.gov.in/communications/notification/notification-8-2022.pdf

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