03-12-2025, 02:06 PM
Questions / Scenarios:
1) Is Maturity Payment of "Life Insurance Plan" is Taxable
2) How to disclosure Life insurance Premium Paid in Tax Returns (Should Profit/Bonus Credited in Account may also be disclosed)
Findings:
1) Life Insurance Maturity payment is not explicitly discussed in Income Tax Ordinance, 2001. However, unless any receipt is specifically made taxable in its nature, it can not be treated as taxable. Therefore, the assumption is it remain exempt.
2) I only show Premium paid by myself.
However, another way could be to show bonuses and profits credited to my insurance plan may as Asset, while in Income we can show such Profits/Bonuses (Exempt Income).
In this way if Maturity Payment is made taxable in future, then the split is over earlier periods may avoid taxation of whole amount.
1) Is Maturity Payment of "Life Insurance Plan" is Taxable
2) How to disclosure Life insurance Premium Paid in Tax Returns (Should Profit/Bonus Credited in Account may also be disclosed)
Findings:
1) Life Insurance Maturity payment is not explicitly discussed in Income Tax Ordinance, 2001. However, unless any receipt is specifically made taxable in its nature, it can not be treated as taxable. Therefore, the assumption is it remain exempt.
2) I only show Premium paid by myself.
However, another way could be to show bonuses and profits credited to my insurance plan may as Asset, while in Income we can show such Profits/Bonuses (Exempt Income).
In this way if Maturity Payment is made taxable in future, then the split is over earlier periods may avoid taxation of whole amount.