You may be able to claim income protection premiums on your yearly tax return. The amount you can claim will depend on your taxable income and your marginal tax rate. However, there are some exceptions that may mean you’re unable to claim, which we detail below.
First off, you cannot claim on premiums if you’ve taken out cover through your superannuation fund, and your premiums are taken out of your regular contributions. Those contributions are already tax exempt.
You also cannot claim on any term life, trauma, or TPD insurance premiums. These products insure your life, while income protection insures your income – that’s why it’s deductible.
If you have a linked (i.e. bundled) policy that combines income protection with one of the above products, you may still be able to claim on your premiums, but only the premium amount that relates to the income protection portion.
This will depend on your own unique situation, including in relation to your income, tax situation, and insurance needs. Give yourself the best opportunity possible to get a great value product by weighing up options from both superannuation funds and insurers.
The information provided here is general only and does not consider your personal objectives, financial situation or needs. Before you decide to purchase a product, it is important to read the relevant PDS.