TDS on rent, security deposit and brokerage

Let's break down the TDS (Tax Deducted at Source) liability for the tenant:.

Rent Payments 1. *TDS Applicability*: Yes, the tenant is liable to deduct TDS on rent payments to the landlord, as per Section 194-I of the Income-tax Act, 1961.

2. *TDS Rate*: The TDS rate is 5% of the rent amount, if the rent exceeds ₹50,000 per month.

Security Deposit 1. *TDS Applicability*: No, TDS is not applicable on security deposits, as they are refundable and not considered income.

 Brokerage Payments to Estate Agent 1. *TDS Applicability*: Yes, TDS is applicable on brokerage payments to estate agents, as per Section 194H of the Income-tax Act, 1961.

2. *TDS Rate*: The TDS rate is 5% of the brokerage amount. Important Notes

 1. *Threshold Limits*: TDS is applicable only if the rent exceeds ₹50,000 per month or the brokerage amount exceeds ₹15,000.

2. *PAN Requirement*: The tenant must obtain the landlord's and estate agent's PAN (Permanent Account Number) to deduct TDS.

3. *TDS Return Filing*: The tenant must file TDS returns (Form 26Q) quarterly, providing details of TDS deducted and deposited.

4. *TDS Payment*: TDS must be deposited within the prescribed due dates to avoid interest and penalties. Please consult a tax professional or chartered accountant to ensure compliance with TDS regulations.

Rent provided for business purposes is applicable fir gst.

Tds on rentvis applicable

The amount given as a security deposit to the owner of an asset is not liable to TDS u/s 194I if such amount is refundable in nature. But when that amount of 'deposit' is adjusted against rent, it becomes liable to TDS u/s 194I. Payment made for renting a business center is liable to TDS under this section.

If you are an individual who is not liable to tax audit, rent exceeding Rs 50,000 per month attracts tds @ 2% u/s 194IB

Commission or brokerage exceeding Rs 50 lakhs in a year attracts tds @ 2% under Section 194M.

If your constitution is other than individual, ANNUAL rent exceeding Rs 2,40,000 attracts tds @ 10% u/s 194I

Commission or brokerage exceeding or likely to exceed Rs 50,000 attracts tds @ 2% under Section 194H.

In either case security deposit is not subject to tds.

2% or 5% for individuals not liable to Audit. Many told me it's 5%. Please clarify 

5% upto 30th september 2024. 2% from 1st October 2024 Archana.