1) Monthly rent of Rs.20,000 paid to 4 persons by cash
2) Same amount as above paid by cheque but cheque drawn in the name of single person of those
3) what are the tax implications as far as tax deduction at source on rent is concerned in the above two cases and in the
second case if the cheque is drawn on the 4 persons individually and the total rent per month amounts to Rs. 20,000.
Should be the tax deducted under these circumstances or not?
TDS WILL BE DEDUCTED BY THE PAYER SO IT IS IMMATERIAL WHO WILL RECEIVE THAT.
As per Section 194I TDS has to be deducted rent paid exceeds 1.8 LAcs in Financial year.The limit of 1.8L is appicable to each of the payee.
Hence in you case if you are paying more than 180000 to any of the co-owner, tds need not be deducted in any of the case.
Yegnesh,
In both the cases (1 & 2) TDS have to be deducted since the amount exceeds the prescribed threshold limits. The TDS rates shall be 2% in case of plant or machinery, 10% in case of building, land or furniture.
1) If contract is seperate with all the 4 payee and cheque issued/o r cash paid seperatly then NO TDS because each payee on stand alone basis gets amount below threshold limit i.e 5000/- per month each.
2) Payment to single person then definetly it will attract ITDS.
again for the query by you in second case the reply is same a s in 1.
TDS is required to be deducted if this payment to 4 persons only to avoid TDS and those 4 people are not co-owner.
If those 4 person are co-owner then No TDS is required to be made even if payment of such total amount made to a single person (subject to share of any of such does not exceeds limit specified )
AGREE WITH CA RITHESH...
tds has to be deducted in both the casses as the yearly rent exceeds 180000, so without having doubt deduct the tds to
@ Yegnesh: Is Rs. 20000Total monthly rent paid OR is it The RENT PAID PER MONTH PER PERSON??
| Originally posted by : Vjay | ||
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TDS is required to be deducted if this payment to 4 persons only to avoid TDS and those 4 people are not co-owner. If those 4 person are co-owner then No TDS is required to be made even if payment of such total amount made to a single person (subject to share of any of such does not exceeds limit specified ) |
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