TaxTMI 
TaxTMI 
HI,
OUR COMPANY HAS TAKEN INDIVIDUAL TERM INSURANCE POLICIES FOR THE EMPLOYEES. PREMIUM PAID BY EMPLOYER IS TAXABLE IN THE HANDS OF EMPLOYEE. WHETHER EMPLOYEE CAN TAKE THE DEDUCTION U/S 80C FOR THE INSURANCE PREMIUM PAID ?
80C DEDUCTION ON THE INSURANCE PREMIUM PAID BY EMPLOYER
08 Feb 2011 
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Deductibility of employer-paid insurance premiums depends on whether the premium is treated as paid by the employee or recovered from salary.
Whether employer-paid individual term insurance premiums included in an employee's taxable salary are deductible under 80C. Majority respondents say deduction requires payment by the employee and so is disallowed where the employer pays; an exception is noted where the employer recovers the premium from the employee's salary (deemed payment). A minority view suggests that if the premium is taxed in the employee's hands, the employee may claim the deduction. (AI Summary)
Whether employer-paid individual term insurance premiums included in an employee's taxable salary are deductible under 80C. Majority respondents say deduction requires payment by the employee and so is disallowed where the employer pays; an exception is noted where the employer recovers the premium from the employee's salary (deemed payment). A minority view suggests that if the premium is taxed in the employee's hands, the employee may claim the deduction. (AI Summary)