tax on pension plan surrender

POSTED BY dilip ON June 28, 2012 6:51 pm COMMENTS (8)

I have taken SBI LIFE UNIT PLUS 2 pension plan in sep 2008.Now i would like to surrender it.
Does the surrender value is taxable? can i show the premium paid for FY 2012-13 i.e from Apr to till now for tax deduction?

8 replies on this article “tax on pension plan surrender”

  1. Amit says:

    I had purchased Max life smart invest pension plan on 27-04-2008. Now, Because of some financial requirements, I want to surrender this policy. How much income tax I will have to pay for this surrender value??

    1. It will be added to your income , so as per tax slabs you will pay it

  2. dilip says:

    two confusing replies.which is correct?

    1. Dear Dilip, In case of Pension plan surrender invites tax. No matter it’s after 5Y or 15Y or 25Y. Rules are very clear for surrender of Pension Plan.



      1. dilip says:

        thank you ashal.
        what about jeevan anand?if i surrender the policy ,the amount received is taxable?
        i paid 5 premiums as of now.

        1. Dear Dilip, the Jeevan Anand policy is a traditional plan & after completion of 5Y, the surrender ‘ll be tax free. I repeat after completion of 5Y.



  3. Dear Dilip, as the plan in question is a pension plan, the surrender amount is taxable. No matter you are surrendering after 4Y or 14 years.



  4. Yes, if you surrender if before 5 yrs , it will be taxable as per law !

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