At a glance - Tax treatment of insurance premium
| Nature of insurance policy which the premium is paid by employer |
Taxable / Not taxable |
| 1 |
Insurance where:
- employer is the beneficiary of the policy, or
- employer is the policyholder of the policy and there is no beneficiary named
|
Not taxable, even if the employer subsequently disburses the insurance payout to its employees.
More information available |
| 2 |
Medical insurance - Group |
Taxable if employee is named as beneficiary.
With effect from Year of Assessment 2008, the premiums are not taxable even if the employee is named as beneficiary. |
| 3 |
Travel insurance covering the period of business travel |
Not taxable |
| 4 |
Workmen compensation insurance |
Not taxable |
| 5 |
Insurance which does not fall under (2) to (4), and employee is the beneficiary of the policy |
Taxable |
Insurance premium paid
Q1 How do I find out who the beneficiary?
Please refer to the policy document or check with the insurance provider.
Q2 If the employer pays the insurance premium on behalf of the employees, how is it possible for the employer to account for the benefits in cases of staff turnover?
The benefits are not taxable if the beneficiary is the employer. Where the beneficiary is the employee, the employee will be taxed for the amount of premium paid by the employer until the date of his cessation of employment.