ITD cautions individuals/HUFs paying rent of over Rs 50000:Income Tax Department has issued an advisory for payment ofmonthly rent over Rs. 50000/-. TDS under section194IB is to be deducted byindividuals/HUFs (except those liable tax audit u/s 44AB(a) and (b)) while making payment/credit to residents.

ITD cautions individuals/HUFs paying rent of over Rs 50000.

The ITD has advised such payers to deduct TDS @ 5% and deposit it into Government Account in followingthree easy steps:
1.DeductTDS @ 5% of the rent paid for the entire financial year 2017-18, at the time of credit of rent for the month of March, 2018.
2.Deposit & upload details of tax deducted along with correct PAN of thelandlord in Form 26QC on TIN website (www.tin-nsdl.com) within 30 days from the end of the month in which the deduction is made. (The tenant is not required to obtain TAN).
3. Download & Issue TDS certificateto landlord in Form No. 16C from TRACES website (www.tdscpc.gov.in) within 15 days of uploading Form No. 26QC.

Pointsto be remembered by the Tenant of the Property:

1. All individuals or HUFs (except those liable to audit under clause a and b of section 44AB) paying monthly rent to a resident in excess of Rs. 50,000 are liable to deduct TDS under section 194-IB
2. Deduct tax @ 5 % from the rent payment made to the Landlord.
3. Collect the Permanent Account Number (PAN) of the Landlord and verify the same with the Original PAN card.
4. PAN of the Landlord as well as Tenant should be mandatorily furnished in the online Form for furnishing information regarding the rent.
5. Do not commit any error in quoting the PAN or other details in the online Form. For the purpose of error rectification you have to contact Income Tax Department.
6. Download and furnish TDS certificate in Form 16C (TDS Certificate) from TRACES and issue to the Landlord / Lessor/ Payee within 15 days from the due date of furnishing of the challan-cum-statement in Form 26QC.
7. If the Landlord / Lessor/ Payee is a non-resident, liability to deduct TDS arises under section 195 of the Income-tax Act, 1961

Pointsto be remembered by the Landlord of the Property:

1. Provide your PAN to the Tenant for furnishing information regarding TDS to the Income Tax Department.
2. Verify deposit of taxes deducted by the Tenant in your Form 26AS Annual Tax Statement.
3. Insist on obtaining Form 16C (TDS Certificate) from the tenant which has been downloaded from TRACES website only.

For more knowledge on this topic kindly referTDS On Rent Under Section 194IB of Income Tax

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