TDS on Insurance Commission Section 194D
Any person who responsible for paying to a resident any income by way of the insurance commission, remuneration or reward, whether by way of commission or otherwise, for soliciting or procuring insurance business shall.
What is the rate of TDS Under section 194D?
Section 194D is applicable for all such payments made to a resident whether they are an individual, company or any other category of persons. The rate of TDS are mentioned below.
| Type of Payee | TDS Rate |
| A resident taxpayer (not being a domestic company) | 5% |
| Domestic Company | 10% |
When TDS is deducted
a. At the time of credit of such income to the account of the payee
b. At the time of payment thereof in cash or by issue of a cheque or draft or by any other mode
whichever is earlier.
Exemption limit under section 194D
There are two Instances when TDS is not required to be deducted
- Commission paid does not exceed Rs. 15,000
- Self-declaration under Form 15G/15H
Points to Remember:
- The TDS on an insurance commission paid to a non-resident in India is covered under Section 195.
2. In case the declaration is invalid then the deductor will have to deduct TDS at a rate of 20%.
3. The TDS must be deducted at the basic above tax rates. You need not add a surcharge, education cess, or secondary and higher education cess.
4. Provided that no deduction shall be made under this section from any such income credited or paid before the 1st day of June, 1973.”