Provision Summary:
Under Section 194-IB of the Income Tax Act, individuals or Hindu Undivided Families (HUFs) not liable to tax audit must deduct TDS when rent paid exceeds ₹50,000 per month.
Example:
If you pay ₹60,000/month rent, total annual rent = ₹7,20,000
TDS = 5% of ₹7,20,000 = ₹36,000
You deduct and deposit ₹36,000 to the government, and pay the rest to the landlord
Consequences of Non-Compliance:
Interest for late deduction/deposit
Penalties
Disallowance of expenses under income tax assessment
| Criteria | Details |
| Applicable Section | Section 194-IB |
| Who needs to deduct TDS | Individual or HUF (not under tax audit) |
| Threshold Limit | Rent > ₹50,000 per month |
| TDS Rate | 5% |
| PAN of Landlord | Required – if not available, TDS at 20% |
| When to Deduct TDS | Once during the financial year (typically in the last month of tenancy or March) |
| TAN Requirement | Not required |
| Form to be filed | Form 26QC (challan-cum-statement) |
| TDS Certificate | Form 16C (to be issued to landlord) |
| Due Date to Deposit TDS | Within 30 days from the end of the month in which TDS is deducted |