Section 194DA → Section 212
TDS in respect of Life Insurance Policy
Quick Answer
Section 194DA of the Income Tax Act, 1961 (TDS in respect of Life Insurance Policy) corresponds to Section 212 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 194DA
Section 194DA of the 1961 Act sets out the rules on TDS in respect of life insurance policy. TDS @ 5% on the income component of a life insurance maturity payout, if the payout is not exempt under 10(10D) and exceeds Rs. 1 Lakh.
Under the Income-tax Act, 2025 (effective 1st April 2026), Section 194DA is retained and renumbered as Section 212 of the Income-tax Act, 2025. Retained. Crucial for taxing high-premium policies.
The transition impact on Section 194DA is assessed as High. Ensures tax collection on taxable insurance payouts.
Sec 194DA
Provision Summary
TDS @ 5% on the income component of a life insurance maturity payout, if the payout is not exempt under 10(10D) and exceeds Rs. 1 Lakh.
Sec 212
Provision Summary
Retained. Crucial for taxing high-premium policies.
Key Changes & Highlights
- Computation of 'income component' strictly defined in the rules.
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Frequently Asked Questions
Which subject does Section 194DA of the 1961 Act cover?
Section 194DA of the Income Tax Act, 1961 covers TDS in respect of life insurance policy. TDS @ 5% on the income component of a life insurance maturity payout, if the payout is not exempt under 10(10D) and exceeds Rs. 1 Lakh.
What is the new section number for Section 194DA under the Income-tax Act, 2025?
Section 194DA of the Income Tax Act, 1961 maps to Section 212 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. Crucial for taxing high-premium policies.
How does the Income-tax Act, 2025 affect Section 194DA in practice?
The transition impact for Section 194DA is rated High. Ensures tax collection on taxable insurance payouts.
What is new about Section 194DA under the Income-tax Act, 2025?
Computation of 'income component' strictly defined in the rules. These points are specific to Section 194DA (TDS in respect of Life Insurance Policy).
Disclaimer: This mapping of Section 194DA (TDS in respect of Life Insurance Policy) to Section 212 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 194DA is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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