What are the features of keyman insurance scheme as relating to income tax?........deductibility etc
Thanks
Nikhil
4 Replies
Dinesh N
(Article)
(156 Points)
Replied 09 December 2009
Key Man Insurance Policy
Its an insurance policy taken by a company on its Key Managerial Personnel. If the company is paying the premium, it will be allowed as a deduction u/s 37, & once the policy matures & the amount becomes refundable will be taxable in the case of company as business income & if received by employee will be taxable as income from other sources.
Ansari
(ca final)
(444 Points)
Replied 09 December 2009
| Originally posted by :Dinesh N | ||
| " | Key Man Insurance Policy Its an insurance policy taken by a company on its Key Managerial Personnel. If the company is paying the premium, it will be allowed as a deduction u/s 37, & once the policy matures & the amount becomes refundable will be taxable in the case of company as business income & if received by employee will be taxable as income from other sources. |
" |
Hareesh H Sharma
(Cleared IPCC..now article)
(894 Points)
Replied 09 December 2009
Dinesh a small clarification.I think the treatment is like this
Amt received by employer - Biz income
Amt received by employee - Salary [sec 17(3) and not other source as u said ]
Amt received by any other person other than the two above - Other sources
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