Commission on insurance

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This query is : Resolved

POOJA (Querist)

13 March 2014 Dear sir,

please tell me under which head we have to show commission on insurance?(income from other sources or business income)and whether we can deduct 40% on income to consider expenses incurred for insurance business?

thank you

Amol S Joglekar

Amol S Joglekar (Expert)

13 March 2014 Choice is with the assessee. If the commission is major ingrediant of income, show it under "income from business or profession" , else "income from other sources." As per the administrative circular of CBDT, 40 % can be claimed on adhoc basis.

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Sandeep Dharar

Sandeep Dharar (Expert)

13 March 2014 If the main source of income is commission then show it as business income, otherwise IFOS.40% can b claimed on ashoc basis....

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POOJA

POOJA (Querist)

13 March 2014 whether i have to consider 40% adhoc on total commission received?

Amol S Joglekar

Amol S Joglekar (Expert)

13 March 2014 What is the amount of commission? Refer the circular.....it gives some limit..... If your commission is below the said limit, you can apply the ad hoc deduction.

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POOJA

POOJA (Querist)

13 March 2014 the limit is for 60,000.if it crosses 60,000 then also they can claim the expenses(adhoc)?

Amol S Joglekar

Amol S Joglekar (Expert)

13 March 2014 Books of accounts be maintained, if the amount of commission exceeds the limit. (Of course 40% can be considered as the "thumb rule", in that case as well....)

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