TaxTMI 
TaxTMI 
Taxation of insurance businesses: Clause 55 of the Income Tax Bill, 2025 vs. Section 44 of the Income Tax Act, 1961
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....India. This provision outlines the method for computing profits and gains for businesses in the insurance sector, including those operated by mutual insurance companies or co-operative societies. The clause mandates the use of Schedule XIV for such computations, setting it apart from the general provisions applicable to other income categories such as "Income from house property," "Capital gains,"....
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....operational realities of the insurance sector. Detailed Analysis Clause 55 stipulates that the profits and gains from insurance businesses should be computed in accordance with Schedule XIV, irrespective of the general provisions applicable to other income categories. This approach signifies a departure from the existing framework u/s 44 of the Income Tax Act, 1961, which relies on the First Sch....
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....edule XIV, the provision aims to streamline tax compliance and reduce administrative burdens. Insurance businesses will need to familiarize themselves with the new schedule and adjust their accounting practices accordingly to ensure compliance. Moreover, the clause may impact the tax liabilities of insurance entities, potentially leading to changes in their financial strategies and operational de....
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....isions override other sections of their respective Acts, highlighting the unique nature of insurance business taxation. However, the transition to Schedule XIV may introduce changes in the tax base or liabilities for insurance entities, necessitating a careful analysis of the new schedule's provisions and their implications. Conclusion Clause 55 of the Income Tax Bill, 2025, represents ....