Life insurance is the mostly used tool for getting deduction under section 80C. Tax benefits, no risk and insurance benefits make it an all time favorite investment for the general public. The payment of life insurance premium is allowed as deduction under section 80C and also the bonus and maturity benefits are exempt from tax under section 10(10D).
Deduction under section 80C
In case of an individual – Policy should be taken on own life, or life of spouse or any child (Dependent or Independent, married or unmarried). Premium Paid on life of parents, Brother, Sisters or In-laws are not eligible.
In case of HUF – Policy should be taken on life of any member of such HUF
Deduction is allowed only when the premium is actually paid in the year. Continue reading “Life Insurance Premium – Tax Benefits on Payment and Maturity”