Union Budget 2024-25 (Full) + FINANCE (No.2) Bill, 2024

1. As per provisions of section 194D, any person responsible for paying to a resident any income by way of remuneration or reward, whether by way of commission or otherwise, for soliciting or procuring insurance business (including business relating to the continuance, renewal or revival of policies of insurance) shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rates in force which is at present 5% (in case of person other than company).

2. It is proposed that TDS under section 194D of the Act (in case of person other than company) be reduced from 5% to 2%.

3. The amendment will take effect from 1st day of April 2025.

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Full Text:

Union Budget 2024-25 (Full) + FINANCE (No.2) Bill, 2024

TDS on insurance commission reduced for non-corporate payees, affecting deduction at credit or payment from the effective date. The Finance Bill amends withholding tax treatment for remuneration or reward for soliciting or procuring insurance business by reducing the TDS rate applicable to resident non-corporate payees; payers must continue to deduct tax at source when such income is credited or paid under existing triggering rules and modes, with the reduced rate taking effect from the prescribed effective date stated in the amendment.