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 Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
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.
Related Sections
Related Articles from the Tax Academy
general transition
Surrender Life Insurance Policy Tax: A Guide to DTC 2025
A professional guide on the tax treatment of surrendering a life insurance policy under the new Direct Tax Code 2025 vs the old Income Tax Act 1961. Essential compliance for 2026.
general transition
TDS Sections Mapped: Old Income Tax Act 1961 vs New DTC 2025
A complete professional guide mapping the old TDS sections of the Income Tax Act, 1961, to the new consolidated Section 393 of the proposed Direct Tax Code 2025. Essential for CAs and businesses.
general transition
Direct Tax Code 2025: Tax on Rs 5 Lakh Life Insurance Premium Explained
Expert guide on the new tax rules for life insurance & ULIPs under the Direct Tax Code 2025. Understand the Rs 5 lakh and Rs 2.5 lakh premium limits and their impact.
Frequently Asked Questions
What does Section 194DA of the Income Tax Act 1961 deal with?
Section 194DA (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 Direct Tax Code 2025?
Section 194DA of the ITA 1961 maps to Section 212 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 194DA under the new tax code?
Section 194DA is marked as "Retained" with status "Active". Impact: High - Ensures tax collection on taxable insurance payouts.
What are the key changes to Section 194DA under DTC 2025?
Computation of 'income component' strictly defined in the rules.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
Need professional help on Section 194DA?
Compare trusted providers — both offer DTC 2025-ready CA services.
*Affiliate links — we may earn a small commission at no extra cost to you. Disclosure.
Want to calculate tax on this section?