Tax
Section 10(10D)
Also known as: Insurance Death Benefit Exemption, Tax-free Insurance Proceeds
Income tax provision making life insurance death benefits tax-free for beneficiaries.
Detailed Explanation
Section 10(10D) of the Income Tax Act provides tax exemption on life insurance proceeds received by beneficiaries upon the policyholder's death. For policies issued after 2021, annual premium should not exceed 10% of sum assured to qualify for exemption. This makes life insurance an effective tax-free wealth transfer tool.