LIC Schemes and LIC Policies To Save Tax
Posted on January 17, 2018
Splurging on Income Tax is not what one wants, hence everyone needs to plan their investments properly. To identify a good company and invest one’s hard earned money is an essential task today since there are so many companies which offer attractive schemes to policyholders.
As one prospers, they should keep a track of their investments and make prominent decisions related to long-term schemes and policies.
Why Invest in Life Insurance Corporation’s Schemes and Policies?
The Life Insurance Corporation of India, which is fully government owned franchise has a big market share and ongoing strong claim settlements which are considered to the best in the world. Having a Life Insurance is a necessity for everyone today and it is unfortunate that most of the people, even in this modern age, think of investing in a life insurance in their late 40s.
LIC provides a variety of policies which is an essential product to plan for one’s future and retirement. Individuals should also consider investing in these LIC schemes to secure the education and future of their child. Hence, it is important to keep in mind the purchasing of LIC policies in anticipation of the future.
How to Save Tax While Investing and Which LIC Schemes to Invest In
LIC is a host of different varieties of insurance policies that are suitable as per the needs of different types of customers. All the tax benefits which one gets to avail as the owner of an insurance policy from the most premiere insurance provider in the country are listed below:
(All tax exemptions and benefits for the compensation of LIC premiums on LIC schemes are presented according to the section 80C of the Income Tax Act of 1961)
- LIC Jeevan Saral:
It is categorized as a Special Endowment Plan which has a lot of excellent and flexibilities features of both the Unit Linked Insurance plans and the traditional plans. Jeevan Saral insurance plan provides double death advantage on the sum assured plus the return of premium of up to 250 times the monthly premium amount.
The payment mode of the premiums can be monthly, quarterly, half yearly and even annual. The policy provides loyalty additions after the policy completes ten years and a partial surrender of the policy can be done shortly after three years. The income tax benefit available under section 80C for the premium paid and section 10D for maturity returns.
- LIC Jeevan Akshay VI:
It is a single premium immediate annuity plan which has to be paid by investing a hefty amount of cash. It is not a unit-linked pension plan rather it provides the annuity payment of a fixed amount extending for a lifetime. Since it is a single premium plan, a policyholder pays once and enjoys forever. The premiums paid under this policy are exempted from tax payment under section 80C, and only the pension received will be taxable.
- LIC e-Term Plan:
It is a pure life cover policy which provides financial protection to the policyholder’s family in case of any calamity in the family. In simple terms, it is a regular premium which is non-participating or without a bonus. This is an online term assurance policy, and there is no requirement of any agent to register to this policy. The insurer decides to pay an approved sum assured in the instance of the insurer’s untimely death during the policy terms, but if he/she survives, no amount is payable. For all premiums paid up to Rs. 1,00,000 are exempted of any kinds of tax.
- LIC New Children’s Money Back Plan:
It is a non-linked, with-profit premium regular payment policy which is intended to meet the educational, marriage, and other needs of growing children. This plan also provides a risk cover to the insured child during the policy terms. Hence, one can also consider it as a savings cum protection plan. The income tax benefit available under section 80C for the premium paid and section 10D for maturity returns.
Life Insurance Corporation of India, being the topmost insurance providers in the country, offers various products to cater to the needs of a vast spectrum of customers. The Income Tax rates for the taxpayer’s increases with the increasing yearly income and hence, tax planning plays an important role in saving the policy holders hard earned money. There are several LIC schemes and policies that enable the customers to not only save and invest their hard earned money but also get the benefit of tax exemption.