Hi,

I have a ULIP that I’ve been paying 25K per year from Oct-2007. Now, I’m pretty much ready to surrender this. But have a few questions regarding tax implications

1) I know that surrendering before 5 years means that I have to file my revised returns for the past 5 years reversing the 80C deductions. But is it 5 financial years or 5 years of the policy? I mean, if I wait till Nov-2012 and surrender my policy will I still have to file revised IT returns for past 5 years? Or should I wait till Apr-2013?

2) The income is taxable under normal taxation rules, right? Does this change after 5 years or doesn’t matter?

3) I would be getting around 1lac if I surrender policy now. But if I wait till Nov-2012, i.e. let the policy lapse, will I still get 1 lac in hand (assuming market is in same range). Or would I lose some money due to letting policy get lapsed?

Thanks in advance!