Under section 393(1) [Table: Sl. No. 1(i)] of the Income-tax Act, 2025, tax is deducted at source on…

Section 393(1) (Table: Sl. No. 1(i)) of the Income-tax Act, 2025 (formerly s.194D of the Income-tax Act, 1961) requires any person paying a resident any income by way of remuneration or reward for soliciting or procuring insurance business to deduct tax at the rates in force, where the amount or aggregate of amounts in the tax year exceeds Rs. 20,000. For the financial year 2026-27, Part II of the First Schedule to the Finance Act, 2026 fixes the rate on insurance commission paid to a resident person other than a company at 2%.

5% was the rate for such payees only until 31 March 2025, and 10% and 4% are not the rate for a resident person other than a company.