LIC Tax Benefits - Section 80C, 80D and 10(10D) Complete Guide 2026

LIC policies give you tax benefits at three different stages - making them one of the most tax-efficient investments available in India.

**Stage 1: Premium payment - Section 80C** - Annual LIC premium qualifies for deduction under Section 80C - Maximum deduction: ₹1,50,000 per year - Only premiums up to 10% of SA are eligible for deduction - Example: SA ₹5L, premium ₹52,000 - full ₹52,000 is deductible

**Who qualifies:** - Individual taxpayers (self, spouse, children) - HUF (for HUF-owned policies) - Annual income tax saving at 30% bracket: ₹52,000 × 30% = ₹15,600 per year

**Stage 2: Maturity amount - Section 10(10D)** - Maturity proceeds from LIC policies are completely tax-free under Section 10(10D) - Conditions: - Premium must not exceed 10% of SA (for policies issued after April 2012) - Policy must have been in force for at least 2 years - No TDS deducted on maturity

**Stage 3: Health rider premiums - Section 80D** - If you add a critical illness or health rider to your LIC policy - Rider premium qualifies for 80D deduction (up to ₹25,000 for self, ₹50,000 for senior citizens) - Separate from 80C limit

**Death claim - always tax-free** Under Section 10(10D), death claims are fully exempt regardless of SA amount or premium ratio.

**GST on LIC premium:** - GST is NOT deductible under 80C - only the base premium before GST counts

Call 9415313434 to plan your LIC investment with maximum tax efficiency.