TDS on rent

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 March 2011 Dear Expert,

one of my client paying rs 13500pm as rent plus 2500 pm for maintinance charge lease deed contain as follows-

"Lessee shall pay the lessor the monthly lease rent rs 13500 plus monthly maintinance charges rs 2500 plus service tax,
My question is can i saperate this payment to two saperta section of 194i for rent and 194c for Maintinance.

Thank you

CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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23 March 2011 In my opinion... the nature of payment suggests that the total payment of 13500/- + 2500/- should be covered under 194I.

Querist : Anonymous

Querist : Anonymous (Querist)

23 March 2011 Dear Expert,

Plese mension specific circular /notification

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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27 July 2025 Hey! On your query about **TDS on rent and maintenance charges** — here’s the clarity:

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### Situation:

* Rent: ₹13,500/month
* Maintenance Charges: ₹2,500/month (plus service tax)
* Lease deed mentions both separately.

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### TDS treatment:

**Is it correct to deduct TDS separately under different sections (194I for rent and 194C for maintenance)?**

* Generally, **if maintenance charges are part of the lease agreement and charged as part of rent/lease consideration**, then the entire amount (rent + maintenance) is considered as "rent" under **Section 194I** for TDS purposes.
* If maintenance charges are for **separate services (like housekeeping, security, repairs) rendered by a third party or the lessor distinctly apart from rent**, then it may attract TDS under **Section 194C (contractual work)**.

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### What does CBDT say?

* There is **no specific CBDT circular** exactly dealing with this split.
* However, the **judicial precedents and general practice** are:

* If maintenance is inseparable from rent, deduct TDS on total amount under **194I**.
* If maintenance is a separate service contract, deduct TDS under **194C** on maintenance charges.

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### Practical Advice:

* Check the **lease agreement terms carefully**: Is maintenance part of lease consideration or a separate contract?
* Usually, **if you pay maintenance charges to the lessor as part of rent, deduct under 194I on full amount.**
* If maintenance is paid to a service provider, deduct TDS under 194C on maintenance charges.

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### Summary:

| Payment Type | Deduct TDS under Section | Remarks |
| --------------------------------------------- | ------------------------ | ------------------------------ |
| Rent + Maintenance (to lessor) | 194I | Entire amount treated as rent |
| Maintenance to third party (service provider) | 194C | Deduct on service payment only |

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If you want, I can help draft a note with legal backing or find case law references to strengthen your client’s position. Interested?

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