Keyman Insurance Policy

This query is : Resolved

Santhosh Poojary (Querist)
Follow

03 January 2011 Hello all,

Is keyman insurance policy is exepmted u/s 10?

i think its not exempt, but not sure.

pls confirm.

Regards

Manmohan ACA, CS

Manmohan ACA, CS (Expert)
Follow

03 January 2011 no see section 10(10D) it says all insurance policy is exempted except the key man insurance policy

section 28(vi) specifically provides that any sum received under a Keyman insurance policy including bonus is taxable as business income.

quote from IT Act

section 10(10D) Any sum received under a life insurance policy, including the sum allocated by way of bonus on such policy

other than any sum received --
-under sub-section (3) of section 80DDA or
-under a Keyman insurance policy.

Explanation : For the purposes of this clause, "Keyman insurance policy" means a life insurance policy taken by a person on the life of another person who is or was the employee of the first mentioned person or is or was connected in any manner whatsoever with the business of the first mentioned person;

section 28
The following income shall be chargeable to income-tax under the head "Profits and gains of business or profession", - (i) The profits and gains of any business or profession which was carried on by the assessee at any time during the previous year;
(i)
(ii)
.
.
.
(vi) Any sum received under a Keyman insurance policy including the sum allocated by way of bonus on such policy.

Message likes : 2 times

Santhosh Poojary

Santhosh Poojary (Querist)
Follow

03 January 2011 Thanks dear,
for detail informatin.

Upgrade to CAclubindia Pro. Subscribe Now!