Life insurance is a secured capital contract that is due when the subject of the contract (life insured) is outlived or when any other insured event occurs. This one-of-a-kind financial instrument is as much subscribed to address a whole spectrum of monetary needs arising from business ownership as it is popularly acquired to satisfy one’s personal and family needs.
In their licensing study course, life insurance practitioners learnt that payouts of life insurance contracts owned by individual tax-payers are tax-free. They are also quite clear about the law on tax relief for premiums of policies owned by individual tax-payers that insure their own life or the life of a male tax-payer’s wife (s39(2)(g)(i)).
However, to many, hell starts to break loose when it comes to Business-paid Individual Life Insurance (BpILI). But it never has to be.
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