ULIP Purchase by Parent
This query is : Resolved
12 February 2025
If a parent is the proposer and payer of a single-premium ULIP that insures the life of his adult child, the parent has effectively bought the ULIP on behalf of the child. I have the following queries:
A. Would the ULIP need to be reported on the parent's Schedule AL at the end of the tax year or would it be deemed a gift to the child? If the latter, is a gift deed required?
B. Are insurance companies required to report ULIPs on AIS/AS26? The question arises because ULIP is not a security like shares or mutual funds. If reported, would it be on the AIS of the parent's PAN, the child's PAN, or both?
A. Would the ULIP need to be reported on the parent's Schedule AL at the end of the tax year or would it be deemed a gift to the child? If the latter, is a gift deed required?
B. Are insurance companies required to report ULIPs on AIS/AS26? The question arises because ULIP is not a security like shares or mutual funds. If reported, would it be on the AIS of the parent's PAN, the child's PAN, or both?
12 February 2025
1. Treat it as gift, no gift deed required.
2. It will be reported on maturity or surrender in the PAN of insured person.
2. It will be reported on maturity or surrender in the PAN of insured person.
12 February 2025
Thank you for the precise answers. Regarding your response #2, is it correct to conclude that reporting will only be at the time of surrender/maturity and the purchase will not be reported?
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