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TDS u/s 194I

Anirudh (Student) (299 Points)

22 October 2018

Mr. A is an individual and sole-proprietor who is also liable for tax audit u/s 44AB. He takes TDS registration as he pays rent for his office building on which he deducts TDS.
Now he is also paying rent for a separate flat ie his personal residence. Whether he is liable to deduct TDS on this rent too.

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9 Replies

Rakesh Joshi (CA Final) (1272 Points)
Replied 22 October 2018

Yes. 194 I covers rent on immovable property. It does not says whether personal or business. That means if MrA is liable to tax audit and deducting TDS for office building and hence he is also liable to do TDS for his rental property. ( If exceeds threshold )

rama krishnan (12234 Points)
Replied 22 October 2018

no... not necessary... TDS to be deducted only for expenses incurred for business purposes

1 Like

Anirudh (Student) (299 Points)
Replied 22 October 2018

Hi Rama Krishnan, can u please provide any provision statement reference that confirms your stand?
For section 194C & 194J, it is however clarified that TDS is not applicable for payments made for personal purpose, but no such clarified for 194I.

rama krishnan (12234 Points)
Replied 22 October 2018

Mr. anirudh, for expenses in personal nature, there's no requirement to comply to income tax act. even if it's business expenses and if it is not claimed as expense in p and I, then there's no requirement to comply to provisions of income tax

Mehul Gupta (29 Points)
Replied 22 October 2018

TDS has to be deducted on those expenses which you have to claim as expenditure!
But non deduction of TDS has prosecution which has to be kept in mind

Jatin (Accountant) (3479 Points)
Replied 23 October 2018

Not required to deduct TDS on Rent for personal use, no issue

RAJA P M ("Do the Right Thing...!!!") (127249 Points)
Replied 23 October 2018

I agreed to Mr Rama Krishnan's view...

TDS not deductible for the personal based rental...
Assessee will deduct the TDS on Rent if Office Building.

Rakesh Joshi (CA Final) (1272 Points)
Replied 23 October 2018

As per Second poviso to Section 194I if an Individual or HUF who is liable to Tax Audit u/s 44AB in the preceeding FY is liable to deduct TDS under this section for payment of rent.

Kindly share the link if any mentioning if the property is used for personal purpose no TDS appicable.

1 Like

Anirudh (Student) (299 Points)
Replied 23 October 2018

Please share the provision which says-
Tds is not applicable on personal use OR
Tds is applicable only on those payments which you are claiming as expenses.