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TDS on Rent Paid

Ritesh (Jt Dir) (80 Points)

07 April 2011

If I am paying house rent to someone. Do I have to do TDS if yes then :

a. What is the limit after which I should do TDS?

b. TDS at what rate?

c. What to do with Tax I have deducted?

d. What all details of my land lord will I require?

e. Will I require a TAN?

f. If yes then how do I get a TAN?

g. What form / Certificate do I need to give to my landlord for the Tax Deduction done?

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3 Replies

Shriram Ramachandran (IPCC Student CWA Inter & Processing officer in GNSA Infotech Ltd) (492 Points)
Replied 07 April 2011

Hi Ritesh

An Individual or HUF* cannot Deduct TDS As per section 194 I. So if ur an individual U cannot Deduct TDS. If ur not an Individual then

A) U have deduct TDS if aggregate amount paid to ur Landlord exceeds 180000.

B) 10% - Land & Building , Furniture & Fittings & 2% - Plant & Machinery, Equipment

C) U have to deposit to Govt through Challan no 281 within 7th of next month in which u deduct TDS to avoid Interest. Then for Apr - Feb the last date of deposit of TDS is 31st mar & for Mar it is 30th Apr with interest of 1.5% every month. If u didnt deposit the TDS deducted amount within respective dates then the rental expenses will be disallowed.

D) U need ur Lanlord's PAN No that is enough if he didnt give his PAN NO. then u have to deduct TDS at 20% instead of 10%

E) Yes ur Firm/Company shoul need a TAN No.

F) Fill the TAN Application & submit to the Income tax Office They will allot u the TAN No as soon as possible.

G) Form 16A.

* Individual Or HUF has to deduct TDS if his Gross Receipts Exceeds the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such income by way of rent is credited or paid, shall be liable to deduct income-tax under this section

Thanks I hope this info helped u.

R Shriram.

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SIVASIVA (FCA, Future CA) (4935 Points)
Replied 07 April 2011

When you are an individual and in the previous financial year, your business is coming under Tax audit situation, then in the current year you have to deduct TDs.

Otherwise, NOTHING to worry.

correct me if i am wrong.

2 Like