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The Income Tax Department has issued notices to taxpayers who have been paying monthly rent of Rs 50,000 or more but failed to deduct Tax Deducted at Source (TDS) before remitting the amount to their landlords, a tax expert revealed. Why Are Tenants Receiving Notices? According to tax laws, tena
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FAQ :
Tenants are receiving notices because they have been paying monthly rent of £50,000 or more but have failed to deduct the mandatory Tax Deducted at Source (TDS) before paying their landlords.
From October 2024, the TDS rate for rent payments of £50,000 or more per month is 2%. Previously, it was 5%.
Failure to deduct TDS can result in being treated as an 'assessee in default', incurring interest penalties of 1-1.5% per month, and facing additional fines from tax authorities.
Yes, tenants can avoid penalties if their landlord has already declared the rental income in their Income Tax Return and paid the applicable taxes on it.
Affected tenants can file an updated income tax return to adjust their House Rent Allowance (HRA) claim and rectify the non-compliance before penalties are imposed.
The minimum monthly rent that triggers the TDS requirement is £50,000.
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