Continuing the Knowledge Series- Today we are going to cover the Topic on Employer-Employee investment that comes u/s 37(1)E of Income Tax act and it can help our clients to reduce their Tax Liability(Business Houses).
Today’s Topic: Understanding on Employer-Employee Concept
Under this investment opportunity, we can help our Corporate clients to reduce their Tax Liability(other than 80C) and it can also help them to get a Tax Free amount on maturity.
Please find below the point wise details of the product suggested:
- In this investment there would be two parties: 1) Proposer(Employer) and 2) Life Assured(Employee).
- Company will take an investment plan in the name of the Employee and payment will be made through the Companies account.
- Investment can be of any amount or upto the amount Company wants to take the benefit.
- The company can claim the Rebate u/s 37(1)E(as an expense), for the amount invested.
- Proposer/Company can choose any PPT(Tenure of Payment) like 7years, 10years, and more.
- On completion of the PPT, Company will Assign(transfer the ownership) the policy on the name of the Employee.
- On Assignment, Employee will make the payment equal to the Surrender Value to the Company and become the owner.
- And on the maturity, Employee will get all the amount Tax free u/s 10(10)D of Income Tax.
I hope, I made the concept clear and also find attached the PPT on the same.
This is the best time to speak/ guide our clients, if they want to reduce their Tax liability, as we are nearing the F.Y. ending.
In case, if you need any help, please let me know.