TDS applicability on Rent.

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This discussion clarifies the applicability of Tax Deducted at Source (TDS) on rent payments made by a partnership firm. Even if the firm's turnover doesn't necessitate a tax audit under Section 44AB of the Income Tax Act, TDS obligations still apply. The rules regarding monetary limits for tax audits under Section 44AB are specifically for individuals and HUFs, not for partnership firms, meaning rent payments are subject to TDS.

NK1976

NK1976 (Querist)
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25 March 2021 Dear Sir,

In FY 2017-18 to FY 2019-20 the Sales Turnover is 48 Lacs P.A. approximately in Partnership Firm.
There is no tax audit as per Income Tax U / S 44AB, as turnover does not exceed 1 crore.
We are paying Rent to other for using of Gala Unit & paying monthly rent Rs.50000/ -without TDS deduction. My query is If there is no tax audit, then TDS is applicable on rent?

Please give your advice in the above.

Thanks
N.K.

Ganeshbabu K

Ganeshbabu K (Expert)
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25 March 2021 TDS based on monetary limit specified in 44AB is applicable to Individuals and HUF only and not to partnership firm. So Partnership cannot escape from deduction and payment of TDS

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