The tax benefit on premium paid for a life insurance policy is an important additional advantage of life insurance. It is advisable to understand all aspects of claiming this tax benefit in order to avoid losing it. Let us examine these aspects in detail as per current income tax laws. Pension policies, some of which include a life insurance element, are treated differently for tax purposes. Therefore these are not being considered here.
Tax benefit under section 80C of the ..
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The general impression among people is that proceeds of life insurance policies are totally tax free. However, this is actually subject to certain conditions and also some exceptions. It is necessary for one to be aware of when these proceeds are tax-free and when not, in order to take advantage of the tax benefit. Let us examine the tax treatment of payouts under a life insurance policy in detail.
Pension policies, some of which include a life insurance element, are treated differe ..