Are you the one who is paying rent exceeding INR 50,000/- p.m. for your residential property? Do you know that you are liable to deduct TDS on such an amount?
We know, you have some common statements:
- How would department come to know that I am paying this much of the rent;
- This property is not used for business, this is my residential property;
- How would I comply with TDS returns and all, it is so complicated.
These days the Income Tax Department has flooded employees with notices who have declared rent paid exceeding INR 6,00,000/- for claiming HRA deduction while filing ITR but failed to deduct the TDS on the same. So, somewhere we furnish this information to the department on our own.
So, if you are one of such person, basic provisions of Section 194-IB (Payment of rent by certain individuals or Hindu undivided family) that you should take care:
- Who is liable to deduct TDS: Individual\HUFs (who are having turnover of less than INR 1 Crores from business or INR 50 Lacs from profession in preceding financial year) are liable to deduct TDS under section 194IB.
- Nature of Property: TDS is applicable on rent paid for Land or building;
- Threshold Limit: TDS is to be deducted for the month in which rent payment exceeds INR 50,000/-;
- Due date of TDS Deduction: Such TDS shall deducted while paying rent of last month of the year or last month of the tenancy period;
- TAN requirement : Tenant is not required to obtain TAN for such TDS payment.;
- TDS Deposit challan cum return: TDS shall be deposited through Challan cum statement in Form 26QC (only PAN of the landlord is required).
- Due date of TDS Deposit: TDS shall be deposited within 30 days from the end of the month in which TDS is deducted. E.g., if TDS is deducted in March, 2025 then the same shall be deposited by 30th April, 2025.
- TDS Rate: TDS shall be deducted @ 2% (5% till 30.09.2024).
