Good Morning, Good Afternoon, Good Evening to everyone who
is watching this video.
Welcome to a new episode of Dharamvay.
We were discussing about TDS.
And today I want to discuss about a new section.
Section 194D.
I want to discuss about Section 194D.
What is this section 194D?
What is TDS?
It's a simple thing.
You must have heard a word somewhere or the other.
That I am an insurance agent.
Not me.
Someone says that I am an insurance agent.
What is an insurance agent?
Nothing sir.
It's a simple thing.
We are common people.
We have to get our insurance policy done.
We have to get our insurance done.
We have to get it done on our health and life.
And we don't know how it will be done directly.
Who do we have to talk to?
How do we have to talk?
How much money should we get it done?
How much money should we not get it done?
According to my age, how much amount should I get it done?
How much will be the annual premium?
Who will give me all this information?
An agent.
Who is an agent?
An agent basically brings customers.
Customers like us go to an agent.
To an LIC agent.
We go to him and ask,
Agent sir,
Agent Vinod,
Tell me, Agent Vinod,
That my age is this much and my income is this much.
And I have to get my LIC policy done.
So how much money should I get it done?
These can be my liabilities.
I can give a premium of this much.
So he will tell me all the information.
After telling me all the information,
Then he will ask me,
Now you tell me, which plan do you want to take?
So I will tell him,
I want this plan.
What will he do?
The insurance company will tell him,
This person wants this plan.
You give him this plan.
He is basically working like a broker.
Like you buy shares in the market,
You buy through a broker.
Similarly, when you take an insurance policy,
You can take that policy through an insurance agent.
The agent gives you all the information.
When and how the premium will go.
Now what is the agent doing?
Basically, the customers,
Your customers,
Where are they taking the customers?
To the insurance company.
He is working as a broker in between.
He is working as an agent.
Customers come to him to get information.
He sells them the policy of LIC.
And takes his commission from it.
The LIC company,
The LIC company got the customers.
Who got the customers?
The agent.
What does the agent get?
Commission.
From whom?
From the company.
You got the policy.
The company got the customers.
The premium of the year,
Will be paid to the company.
You became a customer for the company.
You got the policy for you.
And how did this agent benefit?
He made two people meet.
He made the customer meet the LIC company.
He will get commission in between.
Who will give him the commission?
The LIC company will give him the commission.
Is this point clear?
Did you understand the basic?
What is the job of the LIC agent?
You must have seen the ads.
Look at this.
As it is.
Can you see it on the screen?
All the activities related to LIC are done here.
And there is a name.
Peepwala Krishna.
LIC agent.
He is a LIC agent.
He will answer all the questions related to LIC.
He will send you a policy.
On behalf of the company.
You will get the policy.
The company will get the customer.
Who will give him the premium of the year.
And what will he get?
Commission.
Now tell me this commission.
The commission of LIC.
Should it be considered as an income?
Yes or no?
The commission of LIC.
What is it?
It is an income.
In a way, it is his income.
And when he earned this income.
When he earned this income.
Then on this income.
Should the income tax be deducted?
Yes or no?
Yes.
If there is income, then the income tax will be deducted.
And the government is greedy.
What will the government say?
The income tax that you will deposit next year.
At the time of return.
That we.
Deposit it this year.
So will the TDS be deducted on this?
Will it be deducted?
The answer is.
Yes.
It will be deducted.
This is the section.
194D.
194D tells us that.
If there is an insurance agent.
Who is bringing customers.
To give to the company.
So from there.
The commission he will take from the company.
5% TDS will be applied on it.
Means.
For example.
If you get a commission of Rs. 1 lakh.
Then 5% TDS will be deducted.
He will receive only Rs. 95000.
What will happen to the remaining 5%? 5%.
The LIC company.
That agent's income tax.
Will deposit the money in the account.
Okay.
On behalf of this.
5% money.
We have deposited the income tax.
Tomorrow whenever he will file his return.
LIC agent.
Whatever his final tax will come out.
From that 5% money.
Minus.
Will do.
This is the point.
Let's see what it says.
In 194D.
Whose responsibility is it?
Who is the payer?
In everything.
Whose responsibility is it to deduct TDS?
Who is the payer?
In this case.
Who is the payer?
LIC company.
The company is giving the money.
The money.
The commission.
The company is giving.
To whom?
To the agent.
So who?
Who will deduct TDS?
The question is.
Who will deduct TDS?
LIC company will deduct everything.
See.
In 194D.
Whose responsibility is it?
On any person.
Who is responsible.
For paying to the resident.
Any income.
By way of remuneration.
Whether by way of commission.
For soliciting.
Or procuring insurance business.
The person who is giving you insurance business.
When you will give him a commission.
Then by deducting TDS.
You will give the money.
And where will you deposit the TDS?
By going to the agent's income tax account.
Such person is required to deduct.
Tax at the rate of 5%.
And when to deduct?
At the time of credit.
Or at the time of payment.
Whichever is earlier.
If you are doing payment.
Then deduct it.
Before payment.
If you have passed a journal entry in your books.
If you have passed a journal entry.
If you have credited his account.
In the journal ledger.
Then at that time also deduct it.
Whichever is earlier.
Payment or credit.
Whichever is earlier.
Ok Sir.
Come here.
And in this.
There is a basic limit.
Till 15,000.
If till 15,000.
Till 15,000.
In the whole year.
If you get a commission till 15,000.
Then there is no need.
15,000 commission in the whole year.
Is a very small figure.
Is a very small figure in the whole year.
So in that case.
Government says.
That you don't need anything.
In that case.
You don't need to deduct any TDS.
My dear.
5% is the rate of TDS.
But.
If it is above 15,000.
Then only it will be deducted.
Till 15,000.
Any TDS.
My dear.
Will not be deducted.
This was section 194D.
Come.
Let's cover the next section.
194DA.
This is similar.
You will see.
Their numbering.
And their names.
Are given in such a way.
That you will remember.
194D.
If it was of the insurance commission.
Then 194DA.
That thing is.
That you got the insurance money.
Money of maturity.
In the time of maturity.
You got that money.
In the time of maturity.
You got that money.
Sir.
What is the meaning of this.
That in the time of maturity.
You got that money.
I will explain.
Don't take time.
Brother is ahead.
He will explain.
Suppose.
You have done.
Any insurance policy.
Of 1 crore.
Okay.
You have done.
Any insurance policy.
Of 1 crore.
In the name of a person.
Life insurance policy.
And that person died.
Died.
Now.
Whatever is the nominee.
Of that person.
He will get.
1 crore rupees.
In the time of maturity.
Means.
Whenever that situation happens.
That person dies.
You will get.
1 crore rupees.
The first condition is.
That person died.
So got 1 crore rupees.
Remember.
The chapter of deduction.
I told you.
That there is such a policy.
There is such a policy.
That even if you die.
Nothing happens to you.
Even then.
After a certain time period.
Your money.
You will get a little more money.
There are 2 cases.
Either you will die.
Then you will get money.
But even if you don't die.
Even then.
You will get a big amount.
There are two cases.
Do you remember the endowment policy that I explained to
you in the chapter on deduction?
For example, you got 1.25 crore rupees for the policy you
made. You have been giving premium for 20 years.
And this policy covers that if something happens to you for
20 years, then you will get 1 crore rupees.
And if nothing happens to you for 20 years, then don't
worry that you will get 1.25 crore rupees in the 21st year.
This is okay. I keep giving premium. If I die by mistake,
then the family will get 1 crore.
And even if I don't die, then I will get 1.25 crore in the
21st year. This is the endowment policy.
Now, what are we talking about? We are talking about TDS
chapter.
In TDS chapter, we talk about the income on which the
income tax is applicable.
And this year its TDS should be deducted.
We are talking about this.
Now, you have received the insurance money of 1.25 crore
rupees.
First, tell me whether your income should be accepted or
not.
Getting 1.25 crore rupees in the 21st year is an income.
Now, this income, if it is an income, then should the
income tax be deducted? Yes or no?
Should it be deducted? Yes or no? Yes, it should be
deducted.
When will it be deducted? When will it be applicable?
Generally, if I get 1.25 crore rupees today, then I will
deposit the tax next year.
But the government is greedy.
What is the government saying?
If you get the money today, then tell the company to
deposit your TDS today itself.
Deposit your income tax today itself.
This is the section.
When you get the insurance maturity money, then the TDS
provisions are applied on top of it.
Sir, what are you saying?
Sir, this is my money.
I had deposited the money for a bad time.
Now, I am getting that money.
If I didn't die, is it my fault?
What if I died?
If I didn't die, is it my fault?
I didn't die and I am getting that money.
You are considering it as my income.
Sir, this is the provision.
I am helpless in front of you.
What should I do?
This will be considered as your income.
Whatever money you got on maturity.
But keep this in mind.
Keep this in mind.
If this money is taxable in your hands.
If it is only taxable.
Then only the TDS provisions are applied on you.
If it is not taxable.
Then no TDS provision is applied on you, my dear.
Sir, how is it taxable?
Remember the chapter of deduction.
Remember ATC.
Do you remember?
Do you remember ATC?
When I had discussed about LIC.
That if you give it before this date.
Then the premium should not be more than 20%.
Or if you give it before this date.
Then the premium should not be more than 10%.
Assume that the premium goes more than 20%.
The annual premium that you pay.
That sum assured is more than 20%.
Or in some cases, it is more than 10%.
In those cases, the LIC money was taxable.
Assume that you are giving a premium of 25%.
When you get that money, then it is taxable.
And when it is taxable, then the TDS will be cut.
Keep in mind that how much premium was given.
For that, open the chapter of ATC once.
I had made two limits there.
What if the policy is after 1-4-2012?
What if the policy is after 1-4-2013?
Then how much percent do I have to take?
The rate was 20% and 10%.
Meaning? Meaning that the annual premium that you are
giving.
Should not be more than 20%.
Or the annual premium that you are giving.
Should not be more than 10%.
Whose 10%?
As per the policy.
If it is, if it is going, then what will happen?
Sir, when you get that money.
Then it will be taxable in your hands.
And if it is taxable by mistake.
Then the TDS will be cut on that money.
That is why whenever you buy a policy.
Do not buy blindly.
Think first.
First, how much amount are you taking?
And how much premium are you paying on it?
Is the premium more than 20% and 10%?
If it is like this.
Then talk to your agent.
Tell him to make such a system.
That it becomes less than 20% and 10%.
Why? It has two benefits.
One, you will get the full deduction in 80C.
Up to 1.5 lakhs.
What is the second benefit?
When you get this money from LIC.
When you get the money from LIC.
At that time.
TDS will not be cut.
At that time it will not be taxable.
Now see, how do you know these things?
You are taking knowledge.
Knowledge talks are going on.
Knowledge.
You are in the company of a knowledgeable person.
That is why you know all these things.
Now you will keep company of your friends.
Who are smoking on the terrace.
Sitting on the tea pot.
Will your knowledge increase in life?
Tell me.
Always keep good company.
There is a song.
We will win.
If you are with me.
This is company.
If the company is of good people.
Then a person wins in life.
According to a study.
You are average of 5 people.
Who are you?
You are average of 5 people.
Who are these 5 people?
They are around you.
They can be your friends.
They can be your family members.
They can be your relatives.
They can be your classmates.
The 5 people around you.
You become the 6th person.
You will be in the company of 5 fools.
You will become the 6th fool.
You will be in the company of 5 billionaires.
You will become the 6th billionaire.
Because those billionaires discuss new ideas.
Where to invest money?
What to do?
If you don't have any brain.
Still you understand things.
You can hear where to invest money.
What discussion is going on?
Where to invest?
Where not to invest?
That's why always keep good company.
The thing you are studying today.
You got to know a big thing about LIC.
Did you know that money is taxable?
And TDS is deducted on it.
Did you know?
Whenever you will buy LIC policy in your life.
Every person buys it.
You don't have to buy it in today's date.
The situation is going on.
We will not leave our family on the road.
If something happens to us in future.
We will leave our wife and children on the road.
Nobody helps nowadays.
You don't have to buy LIC policy.
Always check while buying policy.
How much premium is going?
It should be 20%-10% or below.
So that you get 80% deduction.
And if premium is less than that.
When you get LIC money on maturity.
Even at that time.
No TDS will be deducted.
That's why I am saying.
Keep good company.
Keep focus on studies.
So that in life.
You get a good position.
This is the point.
Come here.
Let's read it once.
Rate is same.
Rate is 5%.
When companies give you insurance money on maturity.
So TDS will be deducted on 5% rate.
Rest of the money will be given to you.
But if maturity amount is less than 1 lakh.
If maturity amount is less than 1 lakh.
How much is maturity amount?
It is less than 1 lakh.
In that case.
No TDS will be deducted.
If you get 1 lakh insurance receipt.
In that case.
No TDS will be deducted.
Why? Why is 1 lakh limit?
Sir.
Imagine.
There is a rickshaw driver.
He drives rickshaw whole day.
He will add some money.
He will see the policy ad.
433 rupees per day or per month.
You get your life insurance.
He will see the policy ad.
Poor rickshaw driver got his life insurance.
After getting insurance.
He died within 2-4 months.
If he didn't die.
He got maturity money.
He is a poor man.
He got 80-90 thousand.
You deduct his TDS.
He doesn't have any other income.
You deducted his tax.
It was less than the exemption limit.
Still you deducted his tax.
Now he will go to the government for a refund.
That poor rickshaw driver.
Who drives his rickshaw daily.
200-300 rupees per day.
He will leave that.
He will go to the income tax department.
Nirmala Tai.
Give me my refund.
You deducted my tax.
This is wrong.
Why are you harassing small people?
Harass educated people.
Who can talk to someone.
Who can work on a computer.
You harass small people.
Who has a receipt of 1 lakh.
What will be his level?
Why are you harassing him?
In that case, the government said.
Okay.
Receipt of 1 lakh.
If you get insurance receipts,
in that case, no TDS will be deducted because we are also
kind, we also have a heart.
We are not that heartless.
Yes, but if you have receipts worth more than 1 lakh, in
that case, 5% TDS will be deducted provided the insurance
money is taxable.
And when is it taxable?
When the insurance premium is more than 20% or 10%.
Let's read it for formality.
Any sum received under LIC including bonus.
Usually, it is exempted under some conditions.
The condition is 20% or 10% if the premium is less than 10%.
Consequently, sum received under a policy which does not
fulfil the condition is taxable.
If you pay a premium more than 20% or 10%, then it will be
taxable in your hands.
A big thing has emerged in life that whenever you have to
pay a premium of any insurance policy, it should be less
than 20% or 10%.
Talk to your agent and ask him to arrange a premium less
than 10%.
What is the rate? 5% rate.
And on whom should 5% be deducted?
On the money received.
Because what is TDS basically?
TDS is an income tax.
And on whom does income tax apply?
Income.
Now, what is income?
Suppose, I had received 1.25 crores.
Should I give this 1.25 crores as my income?
Should I consider 1.25 crores as income?
Because I have given a premium to earn it.
Although I have received 1.25 crores, but I have also paid
a premium of 1 lakh rupees.
I have paid a premium of 1 lakh rupees to earn 1.25 crores.
I have paid a premium of 20 lakhs and I have received 1.25
crores.
If you understand this from the agent's point of view,
I have paid a premium of 20 lakhs to earn 1 lakh rupees
every year for 20 years.
I have paid a premium of 20 lakhs and I have received 1.25
crores.
So, what is the income? 1.25 crores.
I have earned 1.25 crores by giving 20 lakhs.
So, the income is 1.25 crores.
I have to deduct 5% on this.
You don't have to deduct it on the total receipts.
Because receipts are not your income.
Your income is what you have received on the premium.
So, you will deduct 5% on the income.
5% is the rate on the amount of income comprised therein.
After deducting the premium paid by the SAC from the sum
received.
And if it is 1 lakh rupees, then there is no TDS in that
case.
This is an illustration.
Please have a look.
Please have a look at the second one.
What is the second point?
It is Y and he has to get 3,95,000 rupees on 31-03-2023
which he has taken from the LIC.
The sum assured is 3,50,000 rupees.
The balance will be there.
And the annual premium is 26,100 rupees.
So, check the 20%-10% limit.
The premium that he is giving of 26,100 rupees, what is the
percentage of that?
He has already solved it.
Please have a look.
The second point is that the annual premium is less than
20% of the sum assured in respect of policy taken before
1-4-12.
So, the sum that would be exempt.
Please have a look.
If the premium is less than 20%, then whatever money I am
receiving, is exempt.
And if by mistake, all the money would have been taxable.
All the income would have been taxed on it.
Such a great thing has been said in today's lecture.
The person who has missed today's lecture or has seen it
while sleeping, imagine what a huge loss that person has
done to his life.
Your friends who have missed this lecture, please tell them
to watch today's lecture.
There is talk of lakhs of rupees tax here.
No tax is required to be deducted.
This is the point.
Hope so, friends.
Today's lecture points will be clear to you.
We have discussed about 194D and 194DA.
What did D say?
Insurance commission.
If you get commission, it is 5% rate of TDS.
And what is this?
Even if you get money during maturity, your TDS will be
reduced to 5% rate.
See you in the next lecture.
Thank you very much.