I have a pension plan since 2004 and paying Rs10,000/- as annual premium, the current value of the units is Rs.3,11,000/- and I want to surrender it. My question is:
a- can I surrender a ULIP pension plan before maturity and what is the tax implication
b- the tax advisor telling me if I surrender and amount is credited to my SB account, I’ll have to pay tax as per my slab but if I surrender and use the proceeds to buy another product, the first year premium will be paid from it and remaining would be credited to my SB account soon. This will not attract tax from the closure of pension policy I bought in 2004. is this true?
c- shall I continue with this policy or exit from it
thanks a lot,
First thing is that stop relying on YOUR TAX ADVISER. The rule is as below for all maturity or surrender value.
“If your policy is issued on/after April 01, 2003 but on/before March 31, 2012, then the proceeds are exempt from tax only if the premium payable for every year is less than or up to 20% of the sum assured.”
Check and conclude on your OWN.