What type of insurance policies can darren claim against

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Reference no: EM132055795

WEALTH PROTECTION - TAX PLANNING

1. About 8 years ago, Darren bought a $150,000 5-year limited-pay whole life plan. The annual premium for his plan was $19,500 p.a. The Cash Value of his plan is $48,750.

2. Darren has put in place a Hospital Income Insurance Plan that is designed to pay him a daily cash benefit of $250 up to 180 days per hospitalization and for 1000 days per lifetime. The premium for the Hospital Income Insurance plan is $1,975 p.a.

Darren recently bought a Disability Income Insurance policy with a sum assured equal to 70% of his monthly salary, i.e. $5,250 which is 70% of ($5,000 +$2,500). The deferred period is 6 months in the event that he is disabled and the Disability Income Insurance policy covers him up to the age of 65 years. The annual premium for his plan is $10,800 p.a.'

4. Darren rents out one common room to Mr Leow for $850 per month. Mr Leow has gone overseas for 6 weeks and will return in early January 2017. Mr Leow said that he would pay the rent for December 2016 and January 2017 upon his return.

1) State the year of assessment Darren needs to declare the rent income?

2) What type of insurance policies can Darren claim against his Life Insurance Tax Relief?

Reference no: EM132055795

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