Tds On Payment In Respect Of Life Insurance Policy [Section 194da] | Ay 2019-20 Onwards

Written by KnowYourGST Team under GST

Taxability of sum received under a life insurance policy

Under section 10(10D), any sum received under a life insurance policy, including the sum allocated by way of bonus on such policy is exempt subject to fulfillment of conditions specified under the said section.

Consequently, the sum received under a life insurance policy which does not fulfill the conditions specified under section 10(10D) is taxable.

Rate of TDS under section 194DA

For ensuring a proper mechanism for reporting of transactions and collection of tax in respect of sum paid under life insurance policies which are not exempt under section 10(10D), section 194DA provides for deduction of tax at the rate of 1% on any sum paid to a resident under a life insurance policy, including the sum allocated by way of bonus, which are not exempt under section 10(10D).

Threshold limit

Tax deduction is required only if the payment or aggregate payment in a financial year to an assessee is Rs 1,00,000 or more . This is for alleviating the compliance burden on the small tax payers.

Author
Posted by CA Ankit Sharma under Income-Tax

I am CA, you can contact me for resolving all your tax queries. Reach me at ankitsharma1141@gmail.comContact

No comments yet, be first to comment.

You need to be logged in to comment.


Never File Wrong GSTR-1

Check your GST numbers in bulk. Check unlimited GST numbers with very cheap packages.

Used by
Ask Question