TDS: When and how should a tenant deduct TDS on rent paid to landlord? – The Economic Times–24.04.2018

By Shubham Agrawal and Vinay Dwivedi

Tenants have to deduct TDS if the rent exceeds a limit. Shubham Agrawal & ET Wealth tell you how to do it.

Who should deduct tax
Individuals and HUFs who are not required to get their financials audited and are paying rent of more than Rs 50,000 per month have to deduct 5% of the rent paid in a financial year as tax.

When to deduct tax
Tax is to be deducted in March, the last month of the financial year. But if the property is being vacated before the end of the fi nancial year, tax is to be deducted in the last month of the tenancy. The last date for March compliance without interest or penalty is 30 April

TDS deadline and the form to use
You have to pay tax online via Form 26QC which is a challan-cumpayment form within 30 days from the end of the month in which the tax is deducted. For instance, if tax is deducted in March, the last day to deposit the tax and file 26QC will be 30 April 2018.

What if you don’t comply?
1. You have to pay 1% interest for every month of delay in deducting the tax. The penalty is higher at 1.5% per month if the tax has been deducted but not deposited.

2. Delay in fi ling of Form 26QC invites a late fee of Rs 200 per day. For delay in issuing Form 16C, the penalty is Rs 100 per day.

3. If Form 26QC is not fi led within one year after the due date, a penalty ranging from Rs 10,000 to Rs 1 lakh could be levied on the tenant.

How to pay the tax
The first step is to fi ll Form 26QC, available at You will have to furnish details such as your and the landlord’s PAN, email ID and phone number; address of the property, the amount of tax deducted, etc. There are options for fi lling multiple PAN in case the property is owned by several people or is leased by multiple tenants. Multiple Form 26QC will have to be fi led if there are multiple landlords.

After furnishing Form 26QC details, the ‘E-tax payment immediately’ option will allow you to deposit the TDS with the taxman via Net banking, debit or credit cards. You can make the payments at a later date by opting for the ‘e-payment on subsequent date’ option. You may also visit any authorised bank’s branch to deposit the TDS once you have filled the Form 26QC.

You are required to furnish the TDS certifi cate—Form 16C—to the landlord within 15 days of the last permissible date of fi ling Form 26QC. For instance, if you submit 26QC and deposit the tax on 30 April, then the last date of furnishing Form 16C to the landlord would be 15 May. Form 16C is available at http://www.tdscpc. and you can download it in 3-7 days after depositing the tax.

Shubham Agrawal is CA & senior taxation adviser at
Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of

via TDS: When and how should a tenant deduct TDS on rent paid to landlord? – The Economic Times

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