Section 194DA relates to the deduction of TDS in respect of life insurance policy, and the provisions of the same are covered under the present article.
Basic provisions of section 19DA
Section 194DA of the Income Tax Act, 1961 covers the person making payment to a resident person any sum under the life insurance policy. It is important to note that section 194DA includes the sum allocated by way of bonus.
Rate of TDS under section 194DA of the Income Tax Act, 1961
The Deductor, liable to deduct TDS as per provisions of section 194DA of the Income Tax Act, 1961, is required to deduct TDS @ 1%.
However, in the Union Budget, 2019, it has been proposed to increase the rate of TDS deduction from 1% to 5% and the same would be effective from 1st September 2019.
In case the PAN is not furnished, the Deductor is liable to deduct TDS at maximum marginal rate i.e. 20%.
Time of deduction of TDS –
As per provisions of section 194DA, the Deductor is required to deduct TDS at the time of payment.
Cases wherein TDS is not deductible –
- TDS is not deductible in case life insurance policy qualifies under section 10 (10D).
- No TDS deductible if the aggregate amount of payment during the financial year is less than INR 1,00,000.
Various due dates –
1. Due date of deposit of TDS with the Government –
The Deductor is required to deposit the deducted TDS within a period of 7 days from the end of the month in which the TDS is deducted.
However, in the case of TDS deducted in the month of March, the same is to be deposited on or before 30th April.
2. Return filing due dates
The Deductor is required to file quarterly TDS return in Form 26Q within following dates –
- Quarter April to June – 31st July
- Quarter July to September – 31st October
- Quarter October to December – 31st January
- Quarter January to March – 31st May
3. Issuance of TDS certificate
The Deductor is required to issue TDS certificate in Form 16A within a period of 15 days of the filing of the quarterly TDS return. The respective due dates would be –
- Quarter April to June – 15th August
- Quarter July to September – 15th November
- Quarter October to December – 15th February
- Quarter January to March – 15th June
Also Read-
Author Bio
I have a LIC policy buy on 08/12/2013. by paying Rs 298177 as premium for SA Rs410000. I got a Money back of Rs61500 on 2016 and 2019 without any TDS.
But at the time of maturity on December 2022 (maturity value Rs343277) TDS being made by clubbing the amount Rs61500*2, which i get on 2016 and 2019. I think TDS should be only on Rs343277, the maturity value less Rs298177 which i paid as premium. please let me know the correct procedure of TDS calculation.
with regards
Aloke Kanungo
09831205988
purchase sbilife insurance in 2010 by paying 100000/- single premium. in 2018 received 123000/- with tds deduction u/s 194da . how it will reflect on my income tax return whenever i have 660000/- gross total income?
WILL TDS UNDER SECTION 194DA, BE REFUNDABLE AFTER FILING INCOME TAX RETURN
Received a sum of Rs 976160.16 after TDS of Rs 15405 was deducted by ICICI Prudential Life Insurance Company under Sec 194DA. Please guide me where this amount will reflect in my IT Return for AY 2020-21
purchsaed ICICI pru life insurance policy in 2013,which was prematuarly redemed in June 2019.Received 567499 with TDS u/s 194da.how it will reflect in my IT returns.My Gross income 4L.
please advise as i file my own returns online.
purchase hdfc life insurance in 2013 by paying 100000/- premium after that no premium paid . in 2018 received 151000/- with tds deduction u/s 194da . how it will reflect on my income tax return whenever i have 350000/- gross total income?