The 60-second version
Section 194D requires 5% TDS on insurance commission paid to resident agents with valid PAN — 10% if PAN missing or invalid; distinct from 194DA maturity payout lane.
194D is commission — 194DA is policy maturity
Section 194D applies when an insurer pays commission to a resident agent or broker — deductor applies 5% TDS if PAN is valid, else 10%.
Returning NRIs who hold LIC agency or general insurance broker codes must update KYC to resident before next commission cycle — else NRI TDS rate may apply.
Maturity lane: Section 194DA guide for policy maturity proceeds at 2%/5%.
Insurance TDS lanes
| Section | Rate | Payment type |
|---|---|---|
| 194D | 5% / 10% | Agent commission |
| 194DA | 2% / 5% | Policy maturity |
| 194J | 10% | Professional fees |
| 194H | 5% | Other commission |
194D sequence
KYC resident
Update agent code with insurer.
Commission due
Insurer calculates payout.
5% TDS
Deducted if PAN valid.
26AS
Verify insurer TAN credit.
ITR
Declare commission under business income.
Flow
194D kit
- Commission stmt.
- TDS cert.
- 26AS.
- PAN.
- ITR ACK.
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PAN check
Invalid or missing PAN triggers 10% TDS under 194D — verify PAN active on e-filing before commission quarter.
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vs 194DA?
194D agent commission; 194DA policy maturity proceeds.
Corporate agent?
Same 5%/10% rate — declare in ITR-3 or ITR-4 as applicable.
RNOR?
Indian insurer commission taxed from resident date.
Form 15G?
If projected total income below exemption.
Foreign insurer?
Schedule FA if foreign policy commission — not 194D.
TDS refund?
Claim in ITR if slab tax below TDS deducted.
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