Tds
This query is : Resolved
22 May 2019
tds applicable on AMC but not on insurance premium why? kindly ref sec please.
22 May 2019
Insurance companies are reputed companies like banks they will account their income rightly hence no TDS envisaged refer 194 section.
22 May 2019
THANKS FOR ASNSWER. BUT STILL WAITING FOR SATISFACTORY ANSWER.
27 July 2025
Great question! Here’s a clear explanation:
---
### **TDS on AMC vs Insurance Premium**
| Payment Type | Is TDS Applicable? | Relevant Section | Reason/Notes |
| ------------------------------------- | ------------------ | --------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------- |
| **AMC (Annual Maintenance Contract)** | Yes | Section **194C** (Contractor) or sometimes 194J (Professional Fees) depending on nature | AMC is considered a **service contract** payment, so TDS applies. |
| **Insurance Premium** | No | N/A | Insurance premium is **not treated as fees for services or contract** under Income Tax Act; hence no TDS. |
---
### Detailed Explanation:
* **AMC:**
AMC is payment for **maintenance/service** provided regularly. Under **Section 194C** (payment to contractors) or sometimes **Section 194J** (fees for professional services), TDS is deductible if the payment crosses threshold limits.
* **Insurance Premium:**
Payment of insurance premium is considered a **capital expenditure or business expense** but **not a payment for services or contract** as per TDS provisions. Hence, **TDS is not deductible on insurance premiums**.
---
### Reference:
* Section **194C** applies to payments to contractors for work done including supply of labor.
* Section **194J** applies to fees for professional or technical services.
* No section mandates TDS on **insurance premium**.
---
If you want, I can help you find official CBDT circulars or Income Tax Act excerpts to keep as documentary proof! Would you like that?
---
### **TDS on AMC vs Insurance Premium**
| Payment Type | Is TDS Applicable? | Relevant Section | Reason/Notes |
| ------------------------------------- | ------------------ | --------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------- |
| **AMC (Annual Maintenance Contract)** | Yes | Section **194C** (Contractor) or sometimes 194J (Professional Fees) depending on nature | AMC is considered a **service contract** payment, so TDS applies. |
| **Insurance Premium** | No | N/A | Insurance premium is **not treated as fees for services or contract** under Income Tax Act; hence no TDS. |
---
### Detailed Explanation:
* **AMC:**
AMC is payment for **maintenance/service** provided regularly. Under **Section 194C** (payment to contractors) or sometimes **Section 194J** (fees for professional services), TDS is deductible if the payment crosses threshold limits.
* **Insurance Premium:**
Payment of insurance premium is considered a **capital expenditure or business expense** but **not a payment for services or contract** as per TDS provisions. Hence, **TDS is not deductible on insurance premiums**.
---
### Reference:
* Section **194C** applies to payments to contractors for work done including supply of labor.
* Section **194J** applies to fees for professional or technical services.
* No section mandates TDS on **insurance premium**.
---
If you want, I can help you find official CBDT circulars or Income Tax Act excerpts to keep as documentary proof! Would you like that?
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- About TDS & Income Tax
- Scrutiny and reopening of past returns
- Under construction property in ITR
- PPF interest-As Exempt Income disclosure
- Pass word to open justification report for Q1 for FY 2026-27
- Section 194JA & JB Income which ITR Form to use
- Upload Level ValidationITR3Category of Defect B/D
- Booth for sales promotion
- Not able to file ITR
- Building tax payment deduction in rental Income
- VALUATION OF PRIVATE LIMITED COMPANY SHARES
- LIABILITY ADJUSTMENT
- Capital Gains on sale of residential flat
- Accounting with Claude
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
