TMI BlogDeduction of income-tax at source--Section 194D of the Income-tax Act, 1961--Deduction from insurance commission, etc.--Financial year 1978-79X X X X Extracts X X X X X X X X Extracts X X X X ..... ent's circular No. 227 [F.No. 275/20/77-IT(B)] dated 14-7-77* on the above subject. 2. Section 194D of the Income-tax Act, 1961, provides for the deduction of tax at source, at such rates as may be specified in this behalf by the Finance Act of the relevant year from payments of income by way of insurance commission to a resident, whether an individual, a company or any other category of person. The rates for deduction of tax at source for the financial year 1978-79 proposed to be specified in Part II of the Schedule to the Finance Bill, 1978, as introduced in the Parliament, are as below: Income-tax Surcharge I. In the case of a person other than a company 10 per cent Nil ; II. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to the above rates. In case any changes in the rates proposed in the Finance Bill, 1978, are made by Parliament, suitable instructions will be sent to you. 5. The substance of the main provisions in the law in so far as they relate to deduction of income-tax from insurance commission is given hereunder:- (i) For the purpose of deduction of tax at source "insurance commission" will mean any income by way of remuneration or reward, whether by way of commission or otherwise, for soliciting or procuring insurance business (including business relating to continuance, renewal or reviving of policies of insurance). (ii) Income-tax will be deductible from the amount credited or paid after 31st May, 1973, even if the relevant amounts acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x to be deducted at source should be rounded off to the nearest rupee by ignoring amounts less than 50 paise and increasing the amounts of 50 paise or more to one rupee. (vii) At the time of deducting tax from the insurance commission credited to an agent's account, adjustment for any debits made in his account in respect of excess commission credited or paid to him earlier is not permissible and income-tax must be deducted from the full amount of commission credited to his account. (viii) It will be open to the recipient of the commission to make an application in Form No. 13D to the Income-tax Officer concerned and obtain from him a certificate authorising the person responsible for paying the income by way of insurance commission to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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