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Prematurity of LIC

Bhavika Tourani (156 Points)

16 August 2021

in case of pre matured lic what amount will be taxable amount received on maturity or profit amount?

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4 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24583 Points)
Replied 16 August 2021

Amount received on maturity

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Nidhi (Chief Accountant) (3150 Points)
Replied 17 August 2021

Profit amount is only taxable.

Bhavika Tourani (156 Points)
Replied 17 August 2021

@ nidhi....is there any logic behind it?

CA. Sourav Sarkar (Chartered Accountant ) (24583 Points)
Replied 17 August 2021

No exemption from income tax on the maturity of policies
Taxation, where the premium paid, is more than 10% of the sum assured – Any money received from a life insurance policy, where the premium is more than 10% or 20% of the sum assured as the case may be, is fully taxable.

So whole amount received on maturity is taxable under other sources