AGENTS' COMMISSION
As per SB Order No. 12/2018, the Agents' Commission for mobilising various Savings Business is as follows:
Savings Bank - Nil
Recurring Deposit - 4%
Time Deposit (1/2/3/5) - 0.5%
Monthly Income Scheme - 0.5%
SCSS - Nil
Sukanya Samriddhi Account - Nil
Public Provident Fund - Nil
MSSC - Nil
NSC - 0.5%
KVP - 0.5%
Click here for the relevant SB Order No. 12/2018
(1). No commission is payable to agents if a Time Deposit account is extended under the provisions of sub Rule (2) of Rule 6 of NSTD Rules 2019
(2). No commission will be payable to agent if the investment in any scheme is not permissible under the relevant rules. If paid, it will be recovered from the agent.
(3). No commission will be paid on the investments received through agents where Agent Receipt Book number issued to the customer is not noted on the Pay-in-Slip and copy of the Agent Receipt Book is not presented along with investment for signature and date stamping by the Counter PA. All such investments will be treated as direct investments.
(4). TDS shall be deducted on commission paid by the CBS System as per the rates prescribed by Income Tax Department from time to time.
(6). No commission is payable if any deposit by agent is made in violation of MPKBY and SAS Agency Rules.
(7) Consequent to introduction of new procedure for payment of commission to agents at sources w.e.f. 21.07.2020, there is no change in the existing procedure regarding supply of Receipt Books to these agents. The counterfoil of the receipt duly singed by the depositor in
lieu of having received the passbook or certificate will be retained by the agent with his/her own copy in the receipt book. The liability of delivering passbooks or certificates to the depositors is of the agent. If any complaint from the depositor about non-receipt of the passbook or certificate is received, this should be brought to the notice of the concerned Regional Director, National Savings for taking appropriate action against the authorized agent.
(8). No commission will be payable to agents on sale of Certificates presenting investment of Provident, Superannuation, Gratuity and Endowment Fund money, funds of Co-operative societies including co-operative banks, compensation money paid to displaced persons in the form of Savings Certificates, Court funds in the control of Government Officers or local or statutory authorities or conversion to Certificates of cash securities already pledged to Government Officers by contractors, etc. or investments required to be made in Small Savings Securities under any statute or by an express order of the Government or investments made by Institutions. Trusts, Companies, Associations etc. or such other investments as may be notified by the Government in this behalf from time to time. On holding invested in excess of the prescribed limit. If any commission is found paid to the authorized agent on the excess holdings, it should be recovered.
(9). Payment of commission to heirs of deceased agents: - In the case of death of the authorized agent, the commission admissible to him/her shall be claimed by his/her heir(s) as a death claim case.
(10). As per Section 194-H of Income Tax Act, 1961, TDS is to be deducted from the commission paid to agents by the authority paying the commission. The rate of tax at source to be deducted will be at the rate notified by the Government from time to time (At present 5% TDS applicable on commission paid).TDS shall be deducted on commission paid by the CBS System as per the rates prescribed by Income Tax Department from time to time. A certificate (Form-16) of TDS deducted and commission actually paid during the financial year should be issued to the authorized agent by the Postmaster annually at the end of the financial year on receipt of a written request to this effect from the authorized agent.
Amendment:
As per SB Order No. 26/2020, collecting ACG-17 receipts from SAS/MPKBY agents for payment of commission will be discontinued. Instead, the commission will be automatically credited to the Savings accounts of the Agents linked to his/her Agent ID at the time of opening of accounts canvassed by them.
The commission on subsequent deposits in RD will be paid to those agents through whom the accounts were opened. The other agents cannot make subsequent deposits in these accounts which were not opened through them.
Click here for the SB Order 26/2020
A TDS certificate in the Form No. 16 A is to be issued quarterly for TDS deducted
on Agent commission by TDS deductors. (Refer: Rule 3 (iv) of Appendix 12 of
POSB CBS Manual 2021)
Recovery of Expenditure: -
The whole expenditure incurred on payment of commission to authorized agents for deposits in RD/TD/MIS/KVP/NSC accounts under the Standardized Agency System/MPKBY Agency is debitable to Ministry of Finance (DEA).
For this purpose, this expenditure is booked by the Postal Accounts Offices direct under the final head “Major Head-8008-Income and Expenditure of National Small Savings Fund-03-
Management Cost-103-Payment of Agency Commission to agents”.
Deduction of TDS:
As per SB order No. 9/2024 dated 1.10.2024 the rate of Tax Deduction at Source (TDS) for the Agent's Commission under Clause 57, Section 194H of the Income Tax Act, has been reduced from 5% to 2% with effect from 01.10.2024. Extract of the amendment is reproduced below:
Clause 57:
"In Section 194H of the Income Tax Act, for the words "Five Percent", the words "two percent" shall be substituted with effect from 7st day of October 2024'.
Click here for SB Order No. 9/2024
