Page 93 - IC23 life insurance application

retirement age. The employers can pay out these annuities, as also the other exit

benefits, from the current revenues on year to year basis.

LIC has evolved a unique plan by which VRS requirements of the employers, can be

taken care of. It is felt that a scheme administered through LIC would inspire

confidence amongst the employees and encourage them to opt for VRS benefits.

The plans to cater to VRS of the employers are essentially of annuity certain type.

The LIC plans under VRS are tailored according to the requirements of the

employers.

VOLUNTARY RETIREMENT SCHEME & INCOME TAX

The amendments to section 19 (10C) of the Income Tax Act provides income tax

exemption on any amount received by an employee of a public sector company or of

any other company at the time of his voluntary retirement in accordance with any

scheme or scheme of voluntary retirement. The schemes of the said companies are

to be in accordance with the guidelines prescribed which may include the criteria of

economic viability. The amendment takes effect from 1st April,1993.

TAXATION ASPECTS UNDER GROUP SCHEMES

SUPERANNUATION FUND

If the Superannuation Fund is approved under part 'B' of the IV Schedule of the

Income Tax Act, the taxation aspect from the point of view of the Employer, Trustees

& Employees will be as under:

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