REGARDING POLICY TAXABILITY

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This discussion clarifies the taxability of life insurance policy proceeds when Tax Deducted at Source (TDS) is applied under Section 194DA. If TDS is deducted, it indicates that the maturity proceeds are considered taxable income. This typically occurs when the payout does not meet the exemption criteria outlined in Section 10(10D) of the Income Tax Act.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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05 November 2025 If TDS is deducted u/s 194DA on maturity of proceeds of life insurance policy, then such income is exempt or taxable?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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05 November 2025 If TDS is deducted under Section 194DA, it means the maturity proceeds of the life insurance policy are taxable, not exempt. This deduction applies only when the payout does not qualify for exemption under Section 10(10D) of the Income Tax Act.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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09 November 2025 Good luck...

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