A death benefits of ETP can be received by person relatives or guardians behind the death of the person. The payment can divided into two types such as tax free and taxable. In tax free component, the death benefits will not consider to tax, but in taxable component the death benefits are subject to tax which can calculate by subtracting the tax free component. There are two types of tax treatments are as follows:
Dependents tax treatment: If any payment can be paid directly, not through any trust means this payment will come under the tax. Taxable amount which is higher than ETP cap can be taxed more than 49% and the taxable component up to the level of ETP cap can consider as tax free.
Non dependents tax treatments: Any payment is paid directly, not by any trust will come under the tax. The Taxable amount higher than ETP cap can be taxed TO 49% and the taxable amount which is up to the ETP cap can be taxed at 32%.