Tax deducted at source
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
19 November 2013
hi..I would like to know the tds rate on commission paid by re-insurance company to insurance company for fy 2012-13.And also is re-insurance business is covered under the definition of insurance business for income tax purpose. kindly advise.
CA PARAS BAFNA
(Expert)
19 November 2013
At many places we read as insurance includes "reinsurance"
.
On plain reading of Section 194D, it seems that re-insurance commission has not been covered but in the context of your above query, I am of the view that the Re-insurance Company is paying commission to the Insurance company for procuring insurance business for itself.
.
So, it should deduct TDS while paying/ crediting commission to the insurance company.
.
In other words, re-insurance is re-insurance for the Insurance Company. It is primarily an insurance business for the other one.
.
On plain reading of Section 194D, it seems that re-insurance commission has not been covered but in the context of your above query, I am of the view that the Re-insurance Company is paying commission to the Insurance company for procuring insurance business for itself.
.
So, it should deduct TDS while paying/ crediting commission to the insurance company.
.
In other words, re-insurance is re-insurance for the Insurance Company. It is primarily an insurance business for the other one.
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