Tds on rental payment to university
This query is : Resolved
28 March 2014
Hi,
We are going to pay rental to University for an amount of Rs.3.00 PA. Can anyone confirm, should we deduct TDS on rental payment under section 194I,if so, can you share which sub para we have to refer. since university insisting us not to deduct TDS.
Regards
Shankar G
9962571414
We are going to pay rental to University for an amount of Rs.3.00 PA. Can anyone confirm, should we deduct TDS on rental payment under section 194I,if so, can you share which sub para we have to refer. since university insisting us not to deduct TDS.
Regards
Shankar G
9962571414
28 March 2014
rs. 180000/- above amount as rent you are paying then you have to deduct tds @ 10% but if it is exempt u/s 10(20) or 10(20A)
then no need to deduct tds
then no need to deduct tds
28 March 2014
certificate under above section with the university
28 March 2014
Thanks for the reply sir...When I checked with section 10(20)is not specified about university and it talks about institutions.
Can you guide me on this. should we not deduct TDS payment university comes under university grands commission.
Can you guide me on this. should we not deduct TDS payment university comes under university grands commission.
27 July 2025
Sure! Here’s the key clarification regarding **TDS on rent paid to a university**:
---
### 1. **TDS Deduction under Section 194I**
* Section 194I requires TDS deduction @10% on rent payments exceeding Rs. 2,40,000 per year.
* Universities generally fall under the category of educational institutions, but **unless specifically exempted**, TDS should be deducted on rent payments.
---
### 2. **Exemption under Section 10(20) or 10(20A)**
* **Section 10(20)** grants exemption for income received by:
* Any university or other educational institution established by a Central, State or Provincial Act; or
* Recognized by the Central Government or the University Grants Commission (UGC).
* This **exemption typically applies to income earned by the university**, **not necessarily to rental payments made to it**.
* If the university is recognized under these acts, it can issue a certificate claiming exemption under Section 10(20).
---
### 3. **What Should You Do?**
* Ask the university to provide a **declaration or certificate** claiming exemption under Section 10(20).
* Without such a certificate, as per Income Tax rules, **you are required to deduct TDS on rent payment under Section 194I**.
* If the university provides exemption proof, no TDS deduction is necessary.
---
### 4. **Reference in Law**
* Section 194I(1) deals with TDS on rent.
* Section 10(20) and 10(20A) specify exemption for certain institutions/universities.
---
### Summary:
| Situation | Action on TDS |
| ----------------------------------- | -------------------------------------------- |
| University provides exemption proof | No TDS to be deducted |
| No exemption proof provided | Deduct TDS @ 10% if rent exceeds Rs 2,40,000 |
---
If you want, I can help draft a formal letter requesting exemption certificate from the university. Would you like that?
---
### 1. **TDS Deduction under Section 194I**
* Section 194I requires TDS deduction @10% on rent payments exceeding Rs. 2,40,000 per year.
* Universities generally fall under the category of educational institutions, but **unless specifically exempted**, TDS should be deducted on rent payments.
---
### 2. **Exemption under Section 10(20) or 10(20A)**
* **Section 10(20)** grants exemption for income received by:
* Any university or other educational institution established by a Central, State or Provincial Act; or
* Recognized by the Central Government or the University Grants Commission (UGC).
* This **exemption typically applies to income earned by the university**, **not necessarily to rental payments made to it**.
* If the university is recognized under these acts, it can issue a certificate claiming exemption under Section 10(20).
---
### 3. **What Should You Do?**
* Ask the university to provide a **declaration or certificate** claiming exemption under Section 10(20).
* Without such a certificate, as per Income Tax rules, **you are required to deduct TDS on rent payment under Section 194I**.
* If the university provides exemption proof, no TDS deduction is necessary.
---
### 4. **Reference in Law**
* Section 194I(1) deals with TDS on rent.
* Section 10(20) and 10(20A) specify exemption for certain institutions/universities.
---
### Summary:
| Situation | Action on TDS |
| ----------------------------------- | -------------------------------------------- |
| University provides exemption proof | No TDS to be deducted |
| No exemption proof provided | Deduct TDS @ 10% if rent exceeds Rs 2,40,000 |
---
If you want, I can help draft a formal letter requesting exemption certificate from the university. Would you like that?
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