Income from LIC commision is generally of insurance agent.
In my opinion, if he/she has no other income, than it will be treated as income from business and profession and will be taxed thereunder.
If he/she has salary income, than it will be definately taxed in the head of Income from other sources.
The benefit of ad hoc deduction will be available to insurance agent upto a commission of Rs.60000 where he/she is not maintaining detailed accounts for the expenses incurred by him/her will be 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
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.
In those cases where income arises more than Rs.60000, there Electricity, Telephone and society bills paid from the agent's account can be claimed, as actual expenditure incurred.
Thanx