Tax Planning
Tax Benefits on Insurance Premiums
Maximize your tax savings with insurance premium deductions.
Insurance premiums deliver dual value—financial protection and tax efficiency. By structuring policies across family members, you can maximize deductions while covering diverse risks such as health expenses, life income replacement, or retirement savings.
Keep a checklist of renewal dates and premium receipts. Submitting proof on time to employers prevents excess TDS, while proper record-keeping helps during assessments. Our advisors map your financial goals with the right mix of term plans, ULIPs, and health covers to ensure every rupee works harder.
Section 80C
Life insurance premiums (including ULIPs) qualify for deduction up to ₹1.5 lakh. Ensure annual premium does not exceed 10% of the sum assured to retain tax-free maturity.
Section 80D
Health insurance premiums for self/family up to ₹25,000 and an additional ₹25,000 (₹50,000 if parents are senior citizens) are deductible. Preventive health check-up deduction capped at ₹5,000.
Section 10(10D)
Maturity proceeds of life insurance policies are tax-free if premium-to-sum assured ratio stays within prescribed limits and policy is not a Keyman policy.
Business & Professionals
Employers can claim premiums paid for group insurance as business expense. Self-employed professionals can cover staff under group mediclaim for tax-efficient retention.
Documentation Tips
Benefits of Using Insurance for Tax Planning
- Lower taxable income while securing long-term protection for family members.
- Encourage disciplined investing through ULIPs and traditional endowment plans.
- Corporate policies help businesses treat premiums as expenses, improving P&L efficiency.
- Compliance with health insurance mandates for employers boosts employee morale.
- Maintain premium receipts, policy bonds, and bank statements for audit trails.
- Ensure PAN/Aadhaar linking on policies to avoid TDS issues.
- Claim deductions in the correct financial year—use ECS/auto-debit to avoid lapses.
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