Section 194 DA of the Income Tax Act

No, 194DA TDS applies to traditional life insurance policies. For Unit Linked Insurance Plans (ULIPs), TDS may not apply, especially if they fall under section 10(10D) exemptions.

Yes, a PLI surrender value calculator can help estimate policy value, enabling TDS calculation under Section 194DA by deducting premiums from the payout to find the taxable portion.

Missing the due date of TDS payment under 194D or 194DA incurs a 1.5% interest per month. Additionally, the penalty for late TDS return filing is ₹200 per day until filed.

Section 194D TDS covers insurance commission for various insurance types, including health, life, and general insurance policies, with a 5-20% rate based on TDS section rules and PAN availability.

TDS means tax collected at the source, aimed at ensuring advance tax collection. In the case of Section 194DA of Income Tax Act, it ensures tax on income from life insurance payouts.

Yes, if PAN isn’t provided under Section 194D of Income Tax Act, the TDS rate rises to 20% compared to the standard 5% for individuals or 10% for companies.

Many people are confused about 194DA income under which head it should be reported. The amount received from a life insurance policy that is not exempt under Section 10(10D) is taxable under the head “Income from Other Sources.”

Section 194DA pertains to TDS on payments made under life insurance contracts where the payment is not exempt under Section 10(10D). If the aggregate amount exceeds ₹1 lakh, TDS needs to be deducted on the income portion.

Yes. If the insurance payout is not exempt under Section 10(10D), the income component of it will be liable for tax. The TDS under Section 194DA is levied only on the taxable portion of the income.

Most of the modern accounting software is capable of identifying payments related to life insurance and automatically calculating TDS under Section 194DA of the Act.

Section 194DA does not apply to property payments. Property transactions are regulated by Section 194-IA of TDS. Section 194DA only applies to non-exempt amounts of life insurance claims.

Surrender values are treated the same as maturity benefits. If the policy is not exempt, the surrender value becomes taxable, and TDS will be deducted.