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Discussion > Income Tax > TDS >

Exemption limit for TDS on rent payment

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CA - Final

[ Scorecard : 484]
Posted On 17 October 2011 at 09:14 Report Abuse

I know that there is a exemption limit for TDS on Rent payment i.e.180000/- P.A. But i have a query that if the rent payment exceeds180000/- than the TDS will be deducted on the whole payment or only on the portion which exceeds180000/-

 

For. E.g. If i am paying a rent of20000/- p.m. i.e.240000/- p.a. than i will liable to deduct tax on60000/- i.e. the portion which exceeds180000/- or on the whole of240000/-


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CA. Saurabh Garg
Chartered Accountant

[ Scorecard : 41]
Posted On 17 October 2011 at 09:20

Dear Rahul

As per section 194I Liability of TDS will automatically arise as soon your liability for rent exceed 180000/- p.a. You are required to deduct TDS on whole amount rather than the excess amount over and above 180000/-.

Thus in your case you are required to deduct TDS on the whole amount of  Rs 240000.

 

You may reach me on cagarg.saurabh @ gmail.com





Mihir
Wealth Manager

[ Scorecard : 4324]
Posted On 17 October 2011 at 09:44

Whole amount.




johnlinkan
teacher

[ Scorecard : 25]
Posted On 17 October 2011 at 12:36

 Yes ofcourse you do it. after 180000 TDS deducted automaticaly on your above rent.




CA. Manish Chandarana
Practising CA

[ Scorecard : 95]
Posted On 17 October 2011 at 14:11

TDS @ 10% will be deducted on whole amt. of Rs.240000/-




srinivasa.B
CA final, Bcom

[ Scorecard : 54]
Posted On 17 October 2011 at 15:41

agree with manish




Poonam Arun Sharma
student

[ Scorecard : 103]
Posted On 17 October 2011 at 16:11

TDS will be deducted on whole amt i.e. 240000/-




Aryan Singhania (Pallav)
❤ Work Hard Party Harder ❤

[ Scorecard : 28793]
Posted On 17 October 2011 at 16:17

earlier it was 120000 ...now with new amendment its 180000...

totally agreed with....poonam ji and manish ji




Rahul Gupta
CA - Final

[ Scorecard : 484]
Posted On 17 October 2011 at 17:19

Thanks for the details as you all said that the TDS will be deducted on the whole amount than along plz answer my one new query as follows:

 

Suppose i am paying a rent of Rs. 15000/- p.m. starting from april 2010 and consequently as it under the Exemption limit so there is no need to deduct tax. But from October 2010 rent has been increased to Rs. 18000/- p.m. and due to this increase the exemption limit will be crossed as the total annual rent for the f.y. 2010-11 will be

15000 X 6 = Rs. 90000

18000 X 6 = Rs. 108000

Total Rent  = Rs. 198000/-

 

As from october i will start deducting tax @ 10% but how will i deduct tax for those rent payments which i have already paid without deducting tax i.e. before October. Should i deduct excess tax from October Payment or Not ? If not than the criteria for tax on whole amount will not apply.

 

Please clarify




Ashutosh Biswal
Asst.Manager Finance

[ Scorecard : 274]
Posted On 17 October 2011 at 21:51

In this case you should deduct tds on the month , where it expected to cross the threshold limit .. like in the month of FEB -2011 and MARCH-2011

In Feb 2011 @ 10% on Rs 1,80,000 = Rs 1800

In March 2011 @ 10% 0n Rs 1,98,000 = Rs 19,800 (but earlier paid Rs 1800 in Feb)  , So liability comes (19,800-1,800) Rs 18,000



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