Adamtien Finance and Insurance

As endowment policies are to be treated for Tax purposes depends on the time at which they were completed. Decisive here is whether the completion is done before or since 01.01.2005. Because from this date there were serious changes to the taxation or Tax incentives for life insurance policies. Contracts which were concluded before 01.01.2005 enjoy nor continuance for the time of his generous support of the state for endowment life insurance. Meets the life insurance, the condition that the contract has a term of at least twelve years, the premium payment is at least five years and the death benefit is at least 60 percent of the sum insured, then the due date of the sum insured paid bonuses completely free of tax. Holders of insurance contracts that were concluded after 01.01.2005 are, unfortunately, no longer qualify for this exemption. For these contracts, the following applies: The surplus, ie the difference between the Tax will be deducted to be paid out the sum insured and the sum of contributions must be wholly or partially with the personal income tax rate. Unless the term of the insurance for at least twelve years, and the payment until after the age of 60 Age of the policyholder occurs, must pay tax on only half of these surpluses. If these conditions are not met, the surplus in the full amount is taxable.

The insurance company is obliged here first, from the taxable amount 25 percent withholding tax directly to the tax office. On the tax return then the policyholder is the individual tax burden and set off against the amount already paid. But also for life insurance policies that were completed before 01.01.2005, may incur a tax liability, the excess shares. This applies if the policyholder contract before the expiry of twelve years but announced or if the insurance it as collateral for a loan assigns, which does not serve to finance owner-occupied residential property. In these cases, the financing bank is obliged to notify the assignment to the tax office. However, the assignment is limited to claims for death, this is not harmful tax. » Read more..