Computation of capital gains on amounts received under a unit-linked insurance policy
20 January 2022

The Finance Act 2021 had proposed to tax the maturity proceeds from unit-linked insurance policy (ULIP) issued on or after 1 February 2021, if the aggregate annual premium exceeds INR 250,000 in any of the financial year during the term of any of those policies. Such taxable ULIPs to be considered as capital asset and subject to capital gains.

In this regard, the Central Board of Direct Taxes, vide Notification dated 18 January 2022, has inserted a new Rule, wherein the method of computation of capital gains has been specified.