Who is the chairperson of Central Depository Services

Solution

The Central Board of Direct Taxes (CBDT) has released detailed guidelines concerning the alterations in the taxation of life insurance policies under clause (10D) of Section 10 of the Income-Tax Act, 1961.   According to Section 10(10D), any amount received from a life insurance policy, including bonuses, is exempt from taxation. However, if the premium paid surpasses the prescribed limits, no exemption will be provided, except in the event of the death of the policyholder.    The Finance Act of 2023 amended Clause (10D) of Section 10 of the Income-Tax Act, 1961. Beginning from the assessment year 2024-25, any sum received under a life insurance policy (excluding unit-linked insurance policies) issued on or after April 1, 2023, will no longer be exempt under this clause if the premium payable for any of the previous years during the term of the policy exceeds Rs 5 lakh. Additionally, if the premium is payable for more than one life insurance policy (other than a unit-linked insurance policy), issued on or after April 1, 2023, the exemption under this clause will only be applicable to those policies where the total premium does not go beyond Rs 5 lakh for any of the previous years during the term of any of those policies.   Importantly, these new provisions will not apply to the sum insured received upon the death of a person.