DOES MATURITY AMOUNT RECEIVED ON LIFE INSURANCE IS TAXABLE OR NOT??

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HERE IN THIS BLOG WE ONLY DISCUSS ABOUT LIFE INSURANCE:

 1. We all know that the
     premium paid on life Insurance is
     allowed as deduction under section 80C of Income tax act, 1961
     but
     there is always confusion about maturity amount received from that life insurance

2. In simple words,
    taxability of maturity amount
    depends only upon the
     Percentage of premium paid to the total sum assured,

 3. If Premium Paid <(less than) 10% of Sum assured--->ANY AMOUNT RECEIVED ON LIFE            INSURANCE IS EXEMPT UNDER SECTION 10(10D) of Income Tax Act, 1961

 4. If Premium Paid is more than 10% then any amount received on maturity is FULLY TAXABLE.
     under head "INCOME FROM OTHER SOURCE".

 5. TDS POINT:  If amount received > Rs. 1,00,000 the TDS @ 2% is deductable.
                             and we can take credit of such TDS in our Income Tax Return.



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