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TMI BlogSection 194D of the Income-tax Act, 1961-Deduction of tax at source-Deduction from insurance commission, etc.-Rate of tax applicable during the financial year 1988-89X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income-tax Act, 1961, were intimated to you. Reference is also invited to this Department's Circular No. 508 [F. No. 275/23/88-IT(B)] dated 23-2-1988 [See [1987] 171 ITR (St.) 4], wherein the fact of levy of surcharge was intimated to you. There is no change in the rate of tax for the financial year 1988-89. For the sake of convenience, the rates for deduction of tax at source under section 194D during the financial year 1988-89 are indicated below: Income-tax 1. In the case of a person (other than a company) who is a resident in India 10 per cent 2. In the case of a domestic company 21.5 per cent 2. Though the provisions of section 194D apply only in relation to income by way of insura ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revival of insurance policies) shall, at the time of payment or credit of such income, whichever is earlier, deduct income-tax thereon at the rates in force. However, no such deduction shall be made under this section in a case where the amount of such income or the aggregate amount of such income during the financial year does not exceed Rs. 5,000. 5. It may be noted that the exemption of Rs. 5,000 mentioned in para. 4 above will not be applicable to such payments made to non-residents. In the case of payments to non-residents. In the case of payments to non-residents where any such sum is credited to any account whether called 'suspense account' or by any other name in the books of account of the person liable to pay such income to a n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may extend to Rs. 5,000. 7. In this connection, attention is invited to the provisions of section 206 of the I.T. Act, 1961, which reads as under: "206. The prescribed person in the case of every office of Government, the principal officer in the case of every company, the prescribed person in the case of every local authority or other public body or association, every private employer and every other person responsible for deducting tax under the foregoing provisions of this Chapter shall prepare, within the prescribed time after the end of each financial year and deliver or cause to be delivered to the prescribed income-tax authority such returns in such form and verified in such manner and setting forth such particulars as may be pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1988 PART II OF THE FIRST SCHEDULE Paragraph A, Sub-Paragraph I In the case of every individual or Hindu undivided family or other association of persons or body of individuals, whether incorporated or not, or every artificial juridical person re ferred to in sub-clause ( vii ) of clause ( 31 ) of section 2 of the Income-tax Act, not being a case to which Sub-Paragraph II of this Paragraph or any other Paragraph of this Part applies— Rates of income-tax ( 1 ) where the total income does not exceed Rs. 18,000 Nil; ( 2 ) where the total income exceeds Rs. 18,000 but does not exceed Rs. 25,000 25 per cent of the amount by which the total income exceeds Rs. 18,000; ( 3 ) whe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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