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What is the TDS rate on Lease Rental payment

Varsha Kalantri (Trainee) (40 Points)

23 February 2010

What is the TDS rate on Lease Rental payment. Whether on lease rents TDS is applicable.

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11 Replies

Rachit (Analyst) (913 Points)
Replied 23 February 2010

In my opinion TDS on lease rental would fall under the purview of sec. 194I.

Amir (Learner) (4016 Points)
Replied 23 February 2010

Dear Varsha,

As per Sec 194I , TDS on Rent is to be deducted as follows -

a) two per cent for the use of any machinery or plant or equipment; and

(b) ten per cent for the use of any land or building (including factory building) or land appurtenant to a building (including factory building) or furniture or fittings:)

No deduction is to be made if Rent to a person doesnot exceed 1,20,000 in a year.

Varsha Kalantri (Trainee) (40 Points)
Replied 23 February 2010

Originally posted by : Varsha Kalantri
	What is the TDS rate on Lease Rental payment. Whether on lease rents TDS is applicable.

This is for vehicles acquired on finance lease. On which it is to be deducted Principal amount or Finance charge or on both i.e. Lease rent.

Varsha Kalantri (Trainee) (40 Points)
Replied 23 February 2010

Originally posted by : Varsha Kalantri
	What is the TDS rate on Lease Rental payment. Whether on lease rents TDS is applicable.

This is for vehicles acquired on finance lease. On which it is to be deducted Principal amount or Finance charge or on both i.e. Lease rent.

Varsha Kalantri (Trainee) (40 Points)
Replied 23 February 2010

Originally posted by : Varsha Kalantri
	What is the TDS rate on Lease Rental payment. Whether on lease rents TDS is applicable.

This is for vehicles acquired on finance lease. On which it is to be deducted Principal amount or Finance charge or on both i.e. Lease rent.

Aditya Maheshwari (CA in Practice) (35867 Points)
Replied 23 February 2010

Then TDS should be deducted @ 2% u/s 194I as hire of machinery

CA Sumit Arora (CA) (1410 Points)
Replied 24 February 2010

Yes it is 2% on hiring of plant & Machinery.

Poornima (Search on.... for knowledge) (129 Points)
Replied 24 February 2010

Originally posted by : Varsha Kalantri
	Originally posted by : Varsha Kalantri What is the TDS rate on Lease Rental payment. Whether on lease rents TDS is applicable. This is for vehicles acquired on finance lease. On which it is to be deducted Principal amount or Finance charge or on both i.e. Lease rent.