Buying a term insurance plan is important as it provides a financial safety net to your family when you are around anymore. The sum assured that is received by the family will help them to be financially independent and accomplish all financial objectives or liabilities if any.
But, do you know that buying a term insurance plan is also an ideal way to save taxes as well.
Choosing the best term insurance plan in India can help you to fulfil all the responsibilities and provide financial stability in your absence to the family. In the process, you can access the tax benefits as well. This is one of the key reasons that make this life insurance product a more preferred choice.
In this article, let us unfold the tax-saving benefits one by one available within the term insurance plan in India.
When your term insurance plan either has an add-on cover or an in-built cover in the form of the hospital care rider, critical illness rid, surgical care rider, and so forth then you can easily access the tax benefits.
Now, wondering who can avail the tax benefits within Section 80D.
For the deductions listed below are the clauses:
Moreover, a Hindu Undivided Family member can also access the tax benefits within this section. When you are not happy with a term insurance policy then you can return the same within the free-look period.
It permits tax exemption till Rs 1.5 lakh every year on the term insurance plan.
Now, wondering who can avail the tax benefits within Section 80D.
For the deductions listed below are the clauses:
This essentially offers tax exemption benefit. Any sum that is received within death benefit for a term insurance plan remains exempted from the tax. It is of not much concern whether the sum is received from any foreign nation or India.
This clause will not be applicable for the following:
The Bottom Line
Undoubtedly, a term insurance plan ensures tax benefit; however that does not mean that you make it sole criteria for choosing the plan.
Moreover, it is prudent to have in-depth knowledge in regards to the provision of claiming tax within a term plan and accordingly file your tax returns. Besides, make sure that you are upgraded with the amendments within the income Tax Act.
A term insurance plan will certainly help you to make the lives and financial future of the family secured and also help you to save money.
Happy tax saving!
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