Life Insurance Policy Deduction 80C

Payments Eligible for Deduction under Section 80C. 1. Payments Towards Life Insurance: If you have bought life or term insurance, then the payments made towards premiums can be claimed under Section 80C of Income Tax Act, 1961.. Fine print of claiming tax benefit on life insurance premium decoded ... Premium can be claimed as deduction under section 80C only in FY in which paid ... As per section 80C(3), in case of a life insurance policy issued on or before 31.3.2012 if the gross premium paid in any year exceeds 20% of the actual sum assured, .... Maximum Premium Allowed under Section 80C. As per section 80C (3), if life insurance policy is issued on or before 31.3.2012, gross premium for calculation of tax deduction should not exceed 20% of the actual sum assured. This means, premium paid in excess of 20% of sum assured will not be allowed as tax deduction.. Section 80C Tax Deduction. Under section 80C of the income tax, ... Over the last year, he paid a premium of Rs. 80,000 for a life insurance policy, and paid Rs. 10,000 for retirement planning. From the above data, Nikhil’s gross total income calculations (in Rs.) are: Nature of income. Amount..

The payment of premium under a life insurance policy offers a life cover to the policyholder. The premiums paid also qualifies for ‘tax benefits’ under section 80C of Income Tax Act, 1961. Section 80C provides a tax deduction for the life insurance premium paid during a financial year.. Life insurance premium paid towards life insurance policy by an individual will be eligible for deduction under section 80c only when such premium is paid by the individual towards his own life insurance policy or to keep in force the life insurance policy of the spouse or the children..

Deduction under section 80C of income tax act is available only when you make the payment or deposit the life insurance premium. All the above benefits of getting deduction for life insurance premium paid shall be reversed if the policy terminated or cease to be in force within 2 years after the date of commencement of such insurance policy.. There is General Perception to taxpayers that All premiums paid for Life Insurance is eligible for deduction under 80C subject to overall Limit of 1.50 Lacs .Further there is misconception that all money received from Insurance Company against Life insurance Policy is exempted from Income tax under section 10(10D)..