TDS ON RENT PAYMENT TO NRI

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When paying rent to a Non-Resident Indian (NRI), TDS must be deducted. Even if the rent is deposited into an Indian NRO account and not remitted abroad, Form 15CA is generally required. If the annual rent exceeds £5 lakh, Form 15CB will also be necessary. This process ensures compliance with Indian tax regulations for rental income paid to NRIs.

Dharmender Leel

Dharmender Leel (Querist)
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06 August 2024 MY CLIENT HAS TAKEN A PROPERTY ON RENT FROM A NRI .HE IS DEDUCTING TDS @31.20% AND DEPOSITING THE BALANCE AMOUNT IN HIS INDIAN ACCOUNT WHICH IS WITH ICICI BANK. MY QUESTION IS WHETHER HE IS REQUITED TO FILE 15 CA ALSO AS HE IS NOT TRANSFERRING THE RENT IN FOREIGN EXCHANGE.

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)
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06 August 2024 No. Not applicable when not transferring the amount to any foreign bank account.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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06 August 2024 a resident tenant would not be able to transfer rent to the NRE account. So the rent will end up in a NRO account only. Your client is doing the right thing.

The Form 15CA etc will apply. if the rent exceeds Rs 5 lakhs, 15CB shall apply too.

For reference: This is ICICI bank website link for their position on NRO/NRE account, Rent and applicable TDS.https://www.icicibank.com/nri-banking/nriedge/nri-articles/nris-guide-to-renting-out-property-in-india

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