My annual wage is ₹15 lakh. I’m investing in life insurance coverage insurance policies and fairness mutual funds schemes. Will the cash acquired from these investments after 10 years be taxable in my arms?
-Seema Parekh
By Balwant Jain, funding and tax professional
Long run capital positive factors 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 price of 10%. So far as maturity proceeds of a life insurance coverage coverage together with ULIP are involved, the identical are exempt below 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 12 months throughout the premium paying time period 12 months 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 prime up premium paid on ULIPs are additionally taken under consideration. Please word any quantity acquired as demise declare from an insurance coverage firm is absolutely tax exempt with none circumstances to the quantum of premium in relation to sum assured.
Please word the above provisions are prevalent right now and the identical might get modified in future like long run capital positive factors on listed shares and fairness mutual fund schemes which have been absolutely tax free until thirty first March 2018, have been made taxable as mentioned above in Finances 2018.
(Views as expressed by the professional.)