How are group income protection insurance (IPI) policy premiums treated for tax purposes?

Group income protection insurance policy premiums are classified as tax-deductible business expenses. This means that businesses can typically deduct the cost of the premiums from their taxable profits when calculating their tax liabilities. This treatment provides a financial advantage to employers who offer this type of insurance, as it can lower their overall taxation by reducing the amount of income that is subject to tax.

It's important to note that this deductibility applies to policy premiums paid by the employer. Therefore, when businesses contribute to group income protection insurance as part of employee benefits, these costs can effectively help in managing tax obligations while providing valuable protection for their workforce.