My annual wage is ₹15 lakh. I’m investing in life insurance coverage insurance policies and fairness mutual funds schemes. Will the cash obtained from these investments after 10 years be taxable in my arms?
By Balwant Jain, funding and tax skilled
Long run capital positive aspects on sale of any fairness oriented mutual funds schemes and listed fairness shares is exempt to the extent of ₹one lakh yearly and past one lakh rupees, it’s taxed at a flat charge of 10%. So far as maturity proceeds of a life insurance coverage coverage together with ULIP are involved, the identical are exempt beneath Part 10(10D) of the Earnings Tax Act supplied the premium in respect of such coverage doesn’t exceed 10% of the particular capital sum assured in any yr in the course of the premium paying time period yr for insurance policies taken after 1st April 2012.
In case the coverage was issued earlier than 1st April 2012, then the premium mustn’t exceed 20% of the capital solar assured. Whereas computing the ten% of the sum assured, any high up premium paid on ULIPs are additionally taken into consideration. Please be aware any quantity obtained as dying declare from an insurance coverage firm is absolutely tax exempt with none circumstances to the quantum of premium in relation to sum assured.
Please be aware the above provisions are prevalent at the moment and the identical might get modified in future like long run capital positive aspects on listed shares and fairness mutual fund schemes which had been absolutely tax free until thirty first March 2018, had been made taxable as mentioned above in Price range 2018.
(Views as expressed by the skilled.)