Tds on rent under section 194i

TDS u/s 194i is the only section wherein TDS is not to be deducted on service tax portion. So I think you need not deduct TDS because it is less than 15000 pm. 

But wait for others to reply.

supporting the view of mihir..

for computation of 180000 limit, amount exclisive of st should be considered.

so in your cas no tds is applicable

On second thought, even though TDS deduction is on the rent excluding the service tax portion, the bill of rent received by the tenant has to be paid in full in the books of account after deducting TDS. TDS will not be deducted on service tax portion, nevertheless the service tax portion happens to be an expense for the tenant and hence becomes a total rent. Service tax portion will be payable by the tenant even if TDS is not deducted on that. How else will the tenant account for the service tax portion which is part of rent and payable? So, yes, TDS will be applicable because the total bill exceeds 180000. 

if the tenants take a credit of service tax then rent amount not exceeds Rs. 180000 pa so NO TDS.

but if tenants are not eligible to take a credit of service tax then the rent amount exceeds Rs. 180000/- so eligible for TDS against rent bill.

TDS is deducted on rent amount only excluding Service Tax .

As per section 194 I TDS need to be deducted on payment of RENT when it exceeds the threshold ceiling limit. (Current limit Rs. 1,80,000/-) i.e Rs. 15,000/-. Per month.

Now What is called RENT  as per section 194 I??

 ‘Rent’ means any payment, by whatever name called, under any lease, sub lease, tenancy or any other agreement or agreement for the use of (either separately or together) any –

• Land, or
• Building (including factory building), or
• Machinery, or
• Plant, or
• Equipment, or
• Furniture, or
• Fittings

Whether or not any or all of the above are owned by the payee.

Service tax paid by the tenant does not partake the nature of income of landlord.

The landlord acts as only a collecting agency for government for collection of service tax.

Therefore tds need to be deducted only on the rent amount ( i.e Excluding service tax portion).

So in your case while computing the threshold limit, you need to consider only the rent amount . Since it is less than 15000 P.M., so you need not deduct tax at source since its well withing the statutory limit..

Refer circular No. 4/2008, Dated 28-04-2008 issued by CBDT.

thnx for clarification Mr kunal Mishra ji and Mr. P!ll @ !

Service Tax Amout will be excluded while computation of TDS u/s 194I

Refer Circular

Circular No. 4/2008 dated 28/04/2008.
Service tax charged by the Landlord shall not be included for
calculating the amount of tax to be deducted from the rent.

No question of deducting TDS . Even the law provides that when deducting TDS u/s 194I, it is to be deducted only on rent portion excluding service tax wherever applicable.

Mr. Vijay, I believe you now have found solution to your query as given above. Landlord is merely acting as a collecting agent for Government. For Section 194I, service tax element is excluded while calculating the limit of Rs.1,80,000. Thanking everybody for their inputs.

TDS is deductible as the payment made during the year exceeds Rs.1,80,000, but TDS will be deducted on rent excluding service tax, as per 194 I tds to be deducted on payment of income & therefore tds is not applicable

any one can provide me please a Bright & usefull  knowledge about TDS upto filing on line return in brief