Kindly guide me in respect of the provisions of ad hoc deduction applicable to LIC agents as per Income Tax Act
7 Replies
CA. Akhil Maheshwari, CMA, MBA
(CA CMA(USA) MBA CS Professional S.IAI)
(605 Points)
Replied 18 November 2011
Dear Ashish,
Ad hoc deduction to insurance agents -
The benefit of ad hoc deduction to Insurance agents of the Life Insurance Corporation having total commission (including first year commission, renewal commission and bonus commission) of less than Rs. 60,000 for the year, and not maintaining detailed accounts for the expenses incurred by them, may be allowed as follows :
(i) where separate figures of first year and renewal commission are available, 50 per cent of first year commission and 15 per cent of the renewal commission;
(ii) where separate figures as above are not available, 331/3 per cent of the gross commission.
In both the above cases, the ad hoc deduction will be subject to a ceiling limit of Rs. 20,000.
The “gross commission” in (ii) above will include first year as well as renewal commission but will exclude bonus commission.
The complete amount of bonus commission is taxable and will be taken into account for purpose of computing the total income, and no ad hoc deduction will be allowed from this amount.
The benefit of ad hoc deduction will not be available to agents who have earned total commission of more than Rs. 60,000 during the year. The admissibility of the expenditure claimed by such agents will be decided by the Assessing Officers as per the provisions of the Income-tax Act.
—Circular : No. 648, dated 30-3-1993.
Ritesh khurana
(CA student)
(175 Points)
Replied 18 November 2011
hi akhil
above provisions are applicable only for LIC agent or all insurance agent receiving commission???
Thanks
CA. Akhil Maheshwari, CMA, MBA
(CA CMA(USA) MBA CS Professional S.IAI)
(605 Points)
Replied 18 November 2011
above provisions are applicable to LIC agents as well as all other insurance agents......
for further reference click on below link : https://law.incometaxindia.gov.in/Directtaxlaws/act2005/cirsec57.htm
Adv. Umang agarwal
(GST & Income Tax)
(209 Points)
Replied 30 May 2014
and which itr's would be filed against the insurence comission...?
CA. Akhil Maheshwari, CMA, MBA
(CA CMA(USA) MBA CS Professional S.IAI)
(605 Points)
Replied 05 August 2014
| Originally posted by : Umang agarwal | ||
 |
and which itr's would be filed against the insurence comission...? |  |
Dear Umang,
ITR -4 can only be filed by the individual receiving insurance commission as his part of income.
SUBHADEEP
(ASST. ACCT)
(21 Points)
Replied 23 February 2015
I FILE MY INCOME TAX RETURN BY ITR-I, AS I HAVE NO INCOME EXCEPT INSURANCE COMMISSION . MAY IT WOULD BE ACCEPTED BY I.T. DEPTT
R.l. Patel
(2 Points)
Replied 11 December 2017
Sir,
My friend earn lic commission Rs. 160000.TDS Rs. 1600, He wants filed income tax return. He have no books of account.
Kindly give computation for filed ITR-4
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