Do you have insurance benefits? Do you end your life insurance or are you about to cancel it? Read when you are required to pay tax and when you don’t have to.
When you pay tax
You pay the tax whenever your insurance company pays you more than you paid to the insurance company . It concerns investment, capital and deposit life insurance.
Income in life insurance is not taxed during the course of insurance . You will only pay the income tax after the insurance is over and the insurance company will pay it by way of a deduction.
The advantage is that the profit is taxed at the end of the insurance . On the other hand, the disadvantage is that you pay unnecessary fees in insurance if you use it only for savings.
The possibility of paying income tax on termination of the contract offers savings programs , which, however, are more advantageous than savings insurance. You simply pay much less on fees and you have access to money during your savings. You can also read about the effectiveness of savings through insurance in this article.
When you do not have to pay tax in life insurance
The subject of taxation is not insurance benefit from the insurance company. By law, this income is exempt from income tax. An exception is insurance benefits in case of survival of a certain age. In this case, the insurance company will pay the tax by deduction.