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Tds on rent adjustment

Satheesh (CMA & CA Final) (189 Points)

28 December 2012

Hi,

We have deposited advance rent with landlord and after vacating the premises we have adjusted the pending (5months) rent payable with the advance rent. Should we deduct TDS on adjustment or not.

Could you please explain the reasons for that.

Please help me out.

Thanks,

Satheesh

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10 Replies

Giridhar S Karandikar (Team Lead) (7543 Points)
Replied 28 December 2012

TD is requried to be made at teh time of credit or payment whichever is earlier. As you had paid advance rent TDS was requried to be made at that time itself. So no need to adjut TDs now.

Was the advacne money paid being in teh nature of Rent or was it a deposit paid to the landlord.

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com ) (3468 Points)
Replied 28 December 2012

If you did not deduct at the time of advance, you should invariably do it now.

Regards,

kavitha (studying final) (830 Points)
Replied 28 December 2012

completely agree with Dipjyothi suggestion...100% correct

CMA RAVI (ASSISTANT MANGER - FINANCE) (478 Points)
Replied 28 December 2012

In my opinion TDS can be adjusted in the financial year itself , if you failed to deduct tds earlier you can do the adjustment with upcoming payments u/s 194 I

Simran (Student) (1165 Points)
Replied 28 December 2012

Yes.... you can do the adjustment with the upcoming payments.

raman (accountant) (54 Points)
Replied 28 December 2012

IS TDS DEDUCTED ON RENTOF SECURITY PAID (ADVANCE) AT THE TIME OF POSSESSION?

manoj kumar (student) (41 Points)
Replied 28 December 2012

Dear sateesh,

I am not agree with the reply of DipJyoti Majumadar

1.The amount given by you at the time of taking premises on rent would have been Security .It was not the rent.So at that time,there was no fault in respect of TDS.

2. Now, As u have adjusted that security with rent due for 5 months.Here u shall have to deduct TDS.

3.but,I think u have delayed the TDS deduction.Bcoz tax was to be deducted at the time of credit at the end of each month.

For discussion on this ,you may contact on kumarmanoj258 @ gmail.com

ashok (Qualified CA) (34 Points)
Replied 28 December 2012

If you are adjusted the rent against advance , Generally adjustment against Advance is happens only at the time of vacating.

if you vacated the premises then you need not to deduct the TDS.

if you are staying in the same premises then you need to make an adjustment entry for Including TDS, Adjust this TDS amount in next month payment.

if it is wrong ,correct me

manoj kumar (student) (41 Points)
Replied 28 December 2012

Mr.Ashok,

U are totally wrong in your answer.Please be correct in your english as well in your answer.

Vacating office doesn't mean that you need not to deduct TDS.

Tds Liability is still there and department can put question.

Nikhil Agrawalla (Articled Assistant) (52 Points)
Replied 02 January 2013

If the rent amount during the financial year exceeds the limit, then you have to deduct the Tax at Source. As while paying it was Security and not rent.