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TMI BlogRationalisation of exempt income under life insurance policiesX X X X Extracts X X X X X X X X Extracts X X X X ..... g bonus on such policy. There is a condition that the premium payable for any of the years during the terms of the policy should not exceed ten per cent of the actual capital sum assured. 2. It may be pertinent to note that the legislative intent of providing exemption under clause (10D) of section 10 of the Act has been to further the welfare objective by subsidising the risk premium for an indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the term of such policy exceeds Rs 2,50,000. It was also provided that if premium is payable for more than one ULIPs, issued on or after the 01.02.2021, the exemption under the said clause shall be available only with respect to such policies where the aggregate premium does not exceed Rs 2,50,000 for any of the previous years during the term of any of the policy. Circular no 02 of 2022 dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed for premium paid, if such premium has not been claimed as deduction earlier. The proposed provision shall apply for policies issued on or after 1st April, 2023. There will not be any change in taxation for polices issued before this date. Hence, it is proposed to amend the Act so as to- (i) insert a new proviso (sixth proviso) to clause (10D) of the section 10 of the Act to provide that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the previous years during the term of any of those policies; (iii) amend the existing sixth proviso (new proposed eighth proviso) to clause (10D) of section 10 of the Act to provide that the provisions of the fourth, fifth, sixth and seventh provisos shall not apply to any sum received on the death of a person; (iv) insert clause (xiii) in sub-section (2) of section 56 of the Act to provide w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that for the purposes of this clause, "unit linked insurance policy" shall have the same meaning as assigned to it in Explanation 3 to clause (10D) of section 10 of the Act; (vi) insert sub-clause (xviid) in clause (24) of section 2 of the Act to provide that income shall include any sum referred to in clause (xiii) of sub-section (2) of section 56 of the Act. 6. These amendments wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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