#13 - 10 Things To Know About LIFE INSURANCE POLICIES | Save Income Tax | Section 80C | FinCalC TV DOWNLOAD our FREE ANDROID APP "FinCalC":
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Hello guys, in this video we are going to see 10 important things that you should know about Life Insurance Premiums to Save your Income Tax
1. Life Insurance Plans are very popular as a tool to get deduction under section 80C of the Income Tax Act
2. Maximum of Rs. 1,50,000 can be deducted under Section 80C in a Financial Year to save your Income Tax
3. An Individual or member of Hindu Undivided Family is eligible to claim deduction against Life Insurance Premiums
4. In case of Individual, deduction is available in respect of policy taken in the name of taxpayer or his/her spouse or his/her children
5. In case of a Hindu Undivided Family, deduction is available in respect of policy taken in the name of any of the members of the HUF
6. One important point to note is, there is a limit of amount that can be claimed as deduction for Life Insurance Premiums under Section 80C. Deduction is restricted to 20% of capital sum assured in respect of policies issued on or before 31-3-2012 and 10% in case of policies issued on or after 1-4-2012.
7. In case of policy taken on or after 1-4-2013 in the name of any person suffering from disability or severe disability the limit will be 15% of capital sum assured
8. Minimum holding period for Life insurance policy is 2 Years. Minimum holding period for ULIP, that is Unit Linked Insurance Policies is 5 years
9. If any of Life insurance policy is terminated or sold, before the minimum holding period specified, then the deduction allowed in earlier years would be deemed as income of the previous year of termination or sale. Further, no deduction will be allowed in respect of contribution or payment, made towards such policy during the year of termination.
10. Total deduction under section 80C cannot exceed Rs. 1,50,000, hence, deduction will be limited to Rs. 1,50,000 if we are using Life Insurance Premiums to save our Income Tax So these are some of the points you should know about Life Insurance Premiums in order to save your Income Tax.
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