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Tds 194 da

TDS 1347 views 2 replies

Roshan

109 Points Joined June 2012

Hi!!!
I have a question about sec.194 da of Income Tax Act.

Suppose I took a Bhima Plus LIC plan with premium Rs. 5 lakhs. The amount I received is Rs. 9 lakhs.They have deducted TDS on the same. Then, what is the taxable amount? Rs.5 lakh or Rs. 9 lakh? Under which head should I assess the income.

Replies (2)

Raphael

Chartered Accountant

214 Points Joined January 2009

Any maturity proceeds of Life insurance policy including bonus is exempted as per sec 10(10D). Provided if the premium paid in a year is more than 10% of the sum assured, then this exemption is not available. In other cases, the bonus can be offered to tax in the year of declaration and the interest/increment if any should also be offered o tax under the head income from other source. Even though TDS is deducted on the entire amount, the entire amount is not subject to taxation.