insurance of employee

[d.v. gupta]

sir,

whether insurance premium paid  for  emplyees life deductible as business expediture.if deductible as business expenditure, premium will be added to salary of employee.

[CA Rachit Agarwal]

No premium will not be required to be added to salary of employee.

Insurance premium on employees is deductible expenditure.

However please note that insurance of employees is deductible under general deductions under Section unlike insurance on plant & machinery which is deductible u/s 31.

AI Summary

Deductibility of employee insurance: premiums are deductible as a business expense and not treated as employee salary. Premiums paid for employee life insurance are deductible as business expenditure and need not be added to the employee's salary; such premiums are deductible under the general deduction framework and are distinct from insurance on plant and machinery.