For many years now, unit-linked insurance plans were taxed where the cover was less than 10 times the premium. Suppose you paid an annual premium of ₹1 lakh. But the sum assured on the policy was less than ₹10 lakh. The policyholder had to pay tax on the gains. Until now, it was not clear whether such gains would be taxed as capital gains or income from other sources. The recent Budget settles this issue partially and brings clarity on the taxation of such Ulips.
Nine big financial changes that you must watch out for in October
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