What is the tax treatment on the sum received at the time of maturity for Ulips? - Sushmita Das, New Delhi
The amount received on maturity of an Ulip is exempt from tax under section 10(10D). With respect to insurance policies issued on or after 1 April, 2012, this exemption is allowed only for policies where premium payable for each year is up to 10 per cent of the sum assured. In case of policies issued between 1 April, 2003, and 31 March, 2012, the exemption is allowed only for policies wherein premium payable for each year is up to 20 per cent of the sum assured. Hence, if these limits in terms of the premium are not complied with, the maturity proceeds shall be taxable.
Advertisement
