TDS on Insurance premium

[Raj Malik]

Whether TDS be deducted on Insurance premium ??

[Sarveshwar Mundra]

Yes, as per section 194D of the I.T. Act 1961

[YAGAY and SUN]

NEW SECTION 194DA

According to the new Act introduced now, tax shall be deducted at source (TDS) on payouts to Resident Indian customers if the cumulative payout across all policies which are not exempt under section 10(10D) equals or exceeds ₹ 1 lakh in a financial year.

• In case PAN is available and valid, 2% TDS will be applicable.
• In case PAN is invalid or not available, 20% TDS will be applicable!

In case your life insurance policy qualifies for Sec 10(10D), no TDS will be deducted.

AI Summary

TDS on insurance payouts: deduction required on cumulative non-exempt policy payouts, higher rates where PAN absent. TDS applies to insurance payouts under the income-tax withholding framework: Section 194D is referenced historically, while Section 194DA mandates deduction on cumulative resident payouts that are not exempt under Section 10(10D). The provision prescribes lower withholding where a valid PAN is provided and substantially higher withholding where PAN is invalid or absent; payouts exempt under Section 10(10D) escape TDS.