i had given a loan of 2,00,000 to one of my friend few yrs back. as he was not able to repay me the loan,he assigned his life insurance policy in my name. now the policy is getting matured and i will be receiving around 6 lakhs.. what will be the tax treatment
RE:amount received from lic
by Ravi Shankar S. on Jul 15, 2007 04:33 PM Permalink
Better you declare the extra amount of Rs 4 lakhs as 'interest income'.
However, just check if it is morally ok for you to charge 4 lacs for a 2 lacs loan. You could return some money to your friend after retaining the normal interest amount.
