194da

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 January 2016 ONE OF MY CLIENT HAS RECEIVED THE PAYMENT FROM LIC ON MATURITY OF THE POLICY AND TDS HAS BEEN DEDUCTED @2% ON WHOLE MATURITY AMOUNT WHETHER WHOLE MATURITY AMOUNT WILL BE TAXABLE OR DIFFERENCE BETWEEN AMOUNT INVESTED AND MATURITY AMOUNT WILL BE TAXABLE PLEASE GUIDE ME

Ankur Singhal

Ankur Singhal (Expert)
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01 January 2016 Dear
The TDS would be deducted on the whole amount received on maturity. The section does not provide for any deduction from the amount received for tds deduction.
Section 194DA reproduced below:
194DA. Any person responsible for paying to a resident any sum under a life insurance policy, including the sum allocated by way of bonus on such policy, other than the amount not includible in the total income under clause (10D) of section 10, shall, at the time of payment thereof, deduct income-tax thereon at the rate of two per cent:
Provided that no deduction under this section shall be made where the amount of such payment or, as the case may be, the aggregate amount of such payments to the payee during the financial year is less than one hundred thousand rupees.

Querist : Anonymous

Querist : Anonymous (Querist)

01 January 2016 Dear Sir

I am asking about taxable amount in income tax return of the assessee

Ankur Singhal

Ankur Singhal (Expert)
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01 January 2016 Sorry dear
The maturity amount is exempted i.e not taxable in hands of assessee.
Section 10(10D) The proceeds under a life insurance policy are exempt under Section 10(10D) of the Act, subject to the provisions of the said section.

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