TDS on insurance

I have received maturity amount of lic rs. 5 lakh after deduction TDs of 1 percent , I will show this in income from other source , can I claim premium as expense in income from other source , can show net margin in other source income, as I have not claimed deduction earlier.
Replies (5)

1. According to sec 194DA, 1 % of the maturity proceeds will be deducted by LIC if the payment exceeds Rs. 1,00,000. However, the above deduction is subject to exemption u/s 10(10D).
2. In your case since they have deducted TDS @ 1% on Rs. 5,00,000, it should not be an exempt income. It will be taxed under the head Income from Other Sources. 
3. According to sec 57(iii), any other expenditure incurred (other than capital expenditure) laid out or expended wholly or exclusively for the purpose of making or earning such income will be allowed as deduction. 
4. Keeping the above provision in mind it can be said that premium paid is an expense incurred and claim that against maturity proceeds. 
5. However, the basic presumption is that LIC premium is exclusively allowed as deduction u/s 80C and it will not qualify as expenses. However, in situations where LIC premium is not allowed as a deduction, it may be considered for expenses. But in most of the cases, it will be allowed only as deduction u/s 80C. 
6. Even though you have not claimed it as a deduction but it may raise doubt if you deduct the premium from maturity proceeds. Since your maturity proceeds reflected in your 26AS will be Rs. 5 lakhs. 
Please correct me if the above interpretation has an alternative view. 

sir deducted is allowed upto 10 percent of the maturity value of policy . in my case premium was above 10 percent of matured value of policy. so I did not cliam exemption

1. Yes. Since your premium amount was higher than 10% of the maturity proceeds it is not exempt u/s 10(10D). 
2. With respect to your claim of premium as expenses will raise a doubt. But since there is no supporting provision which says that you should not claim the premium as an expense u/s 57, you can try. But in my opinion, it is better not to. Because if you claim it will go down to decrease your tax liability only to that extent of premium expenses. 

okey sir thanks for your suggestions.

No Problem.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Related Topics :

Loading
Company
09 September 2026
Chartered Accountant

Aviv Global Private Limited

Ahmedabad

CA

View Details
Company
ARTICLESHIP 07 September 2026
CA Articles

Kothari Jain Patil & Chartered Accountants

Pune

CA Inter

View Details
Company
ARTICLESHIP 21 September 2026
CA Article Assistant

KK & Company Chartered Accountant

Pune

CA Inter

View Details
Company
09 September 2026
SENIOR AUDITOR & ACCOUNTS MANAGER

Anupam Parashar & Co.

Ghaziabad

CA Final

View Details
Company
Featured 21 September 2026
Consultant - Reporting

Finrep Advisors LLP

Mumbai

CA

View Details
Company
22 September 2026
Account Assistant

Chirag P Shah & Co. Chartered Accountant

Pune

B.Com

View Details
Company
09 September 2026
Semi Qualified CA / CA Inter - 2 Groups Cleared

Getmyca Consultant Pvt Ltd

New Delhi

CA Inter

View Details
Company
19 September 2026
CA/Semi-CA/BCom

Pravin Sarvaiya

Mumbai

CA Inter

View Details