TDS · Section 194D · FY 2026–27
Section 194D: TDS on Insurance Commission
Section 194D (TDS on Insurance Commission): the TDS rate is 2%. Threshold: Rs. 20,000 per financial year per agent.
Section 194D covers TDS on insurance commission paid to insurance agents. The rate was reduced from 5% to 2% effective 1 October 2024 (Budget 2024).
Rate source: Income Tax Department TDS rate chart
2%
2%
Threshold
₹20K a year
Who deducts
Insurance companies and their authorised agents.
No PAN
20%
Shows up in
Form 26AS & AIS, quarterly
What it looks like on a real payment
Worked exampleSec 194D
Amount payable to you₹1,00,000
TDS @ 2%− ₹2,000
You receive₹98,000
The ₹2,000 is not lost — it is pre-paid tax, credited in your 26AS and adjusted at filing.
TDS is on the commission value EXCLUDING GST per CBDT Circular 23/2017 when GST is shown separately on the invoice — applies uniformly to all Chapter XVII-B deductions.
Run your own numbersFree 194D calculator — invoice amount in, deduction and take-home out. No signup.What this means for you
If insurance commission is a small slice of your income the 2% usually returns as a refund at ITR — confirm the entry in your 26AS first.
194D covers insurance-agent commission, deducted by the insurer at 2% (reduced from 5% on 1 October 2024) once it crosses Rs. 20,000/year. Relevant if you earn agency commission alongside freelance work. TDS is on the commission excluding GST when GST is shown separately (CBDT Circular 23/2017).
Effective since: 1 October 2024 (2% rate).
When your client must deposit it — and report it
The client must deposit TDS by the 7th of the month after deduction (30 April for March). It reaches your 26AS only after they file the quarterly TDS statement (Form 26Q), due on these dates — which is why a deduction in March can be invisible until 31 May:
Form 26Q · quarterlyFY 2026–27
Q1 — Apr to Jun31 July
Q2 — Jul to Sep31 October
Q3 — Oct to Dec31 January
Q4 — Jan to Mar31 May
FAQ
What is the TDS rate under Section 194D?
Who deducts TDS under Section 194D?
What is the threshold for Section 194D TDS?
Is TDS under Section 194D deducted on the GST-inclusive amount?
How do I claim TDS deducted under Section 194D in my ITR?
Not sure how to claim this TDS back? Read the freelancer’s guide to TDS deducted by clients — how it lands in your 26AS and how you reclaim it in your ITR.
For the CA reading this
The deadline sheet you already send, with your name on it
Every statutory date for the month — GST returns, advance tax, and the dates your client's own customers owe them: when the TDS they withheld must reach the department, and when the certificate is due. Add your firm's name and forward it as it stands. No signup, no email, nothing to accept.
The image is the one that travels on WhatsApp. Dates are statutory, not advice — the sheet says which rows bind whom.
Sources
Rates as notified for FY 2026–27 and can change. General information, not tax advice. Verify with your CA before you file.
Related sections
Every deduction, tracked to the rupee
Your TDS credits, never lost.
HourSlip logs the expected deduction on every invoice and reconciles it against 26AS — so filing season has no surprises.
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