TDS on rent

TDS 3675 views 2 replies

Subappradha

Finance

13 Points Joined March 2007

Hi All,

Please clarify on the below:

Will provisions of TDS be attracted if the rental agreement(for residential apartment) is between an NRI and a foreign citizen?

If a corporate undertakes to bear the rent for the foreign citizen mentioned above, will it amount to perk and the corporate will have to deduct TDS on salaries on the same or pay FBT?

The foreign citizen is on a business visa to India (he is not a resident for the year 2006-07 or any of the previous years)

Thanks.

Replies (2)

If the property is situtated in India then rent income in respect of the property in India will be subject to Tax in India and TDS provisions will also apply. TDS will be under section 195 as this is between Non-residents.

Vk Duggal

320 Points Joined March 2007

Even if the employee is on business Visa, salary will be taxable in India. Some relief is given by the Tax Treaty between India and the country of residence of employee. If salary is taxable, rent will also be included in the salary of employee