The provisions relating to TDS on insurance commission are now covered under Section 393(1) [Table: Sl. No. 1(i)] of the Income-tax Act, 2025, which consolidates various TDS requirements into a structured tabular format. This corresponds to the earlier Section 194D of the Income-tax Act, 1961. This is applicable from 1st April, 2026.
While the core concept of tax deduction on insurance commission remains largely unchanged, the new Act brings a more structured presentation through table-based classification.
Quick Reference – Section Mapping & Reporting
- New Section (IT Act 2025): Section 393(1)
- Table Reference: Sl. No. 1(i)
- Nature of Payment: Insurance Commission or Brokerage
- Earlier Section (IT Act 1961): Section 194D
- Return Form: 26Q
- Code (for return filing): 1005
What are the provisions for TDS on Insurance Commission?
Any person responsible for paying to a resident 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 the continuance, renewal or revival of policies of insurance) shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon.
Rate of TDS
- 2% in case of Individual or HUF
- 10% in case of Domestic Company
Threshold Limit
No deduction shall be made where the amount of such income or the aggregate of such income credited or paid during the financial year does not exceed ₹20,000.
Time of Deduction
TDS shall be deducted at the earlier of:
- At the time of credit of such income to the account of the payee, or
- At the time of payment
Nature of Payment Covered
- Commission or remuneration for procuring insurance business
- Commission on renewal or revival of insurance policies
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