Section 115B → Section 114
Tax on profits and gains of life insurance business
Quick Answer
Section 115B of the Income Tax Act, 1961 (Tax on profits and gains of life insurance business) corresponds to Section 114 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 115B
Section 115B of the 1961 Act sets out the rules on tax on profits and gains of life insurance business. Taxes the profits of a life insurance business at a special flat rate of 12.5%.
From 1st April 2026, the same subject sits at Section 114 of the Income-tax Act, 2025 — retained and renumbered as Section 114 of the Income-tax Act, 2025. Retained. Alignment with IRDAI surplus calculation guidelines maintained.
For Section 115B, the practical impact is rated Low. Niche provision solely for LIC and private life insurers.
Sec 115B
Provision Summary
Taxes the profits of a life insurance business at a special flat rate of 12.5%.
Sec 114
Provision Summary
Retained. Alignment with IRDAI surplus calculation guidelines maintained.
Key Changes & Highlights
- No change.
Related Sections
Frequently Asked Questions
What is Section 115B of the Income Tax Act, 1961 about?
Section 115B of the Income Tax Act, 1961 covers tax on profits and gains of life insurance business. Taxes the profits of a life insurance business at a special flat rate of 12.5%.
Which section replaces Section 115B in the Income-tax Act, 2025?
Section 115B of the Income Tax Act, 1961 maps to Section 114 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. Alignment with IRDAI surplus calculation guidelines maintained.
What is the impact of the change to Section 115B under the new tax code?
The transition impact for Section 115B is rated Low. Niche provision solely for LIC and private life insurers.
Disclaimer: This mapping of Section 115B (Tax on profits and gains of life insurance business) to Section 114 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 115B is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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