TDS on Rent of Property - 26QC

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An Individual or HUF paying rent 50000/- or more per month is required to deduct tax at source (TDS) from 1st June 2017 as per the new amendment in the Law.

As per the new section 194-IB of the Income Tax Act, a tenant is required to deduct and pay 5% of rent where rent amount per month is more than 50000/-

Earlier only those individuals and HUFs were required to deduct TDS who were covered under audit.

With this new change, all individuals and HUFs who are paying rent over and above Rs. 50,000 per month, would be mandatorily required to deduct tax from June 1, 2017 and pay the same to government. 

Some important points in this regard:

1. TDS is to deducted ONLY ONCE annually.

2. The tenant would also be required to issue a tax withholding certificate (Form 16C) to the landlord, as a proof that taxes have been deposited in his name.

3. Tenant do not require to have TAN.

4. Individuals and HUFs whose accounts are not required to be audited under the Indian tax laws are covered under this new section.

5. Permanent Account Number (PAN) of the Landlord is required while filing challan-cum-statement in Form 26QC

6. If the Landlord / Lessor/ Payee is a non-resident, liability to deduct TDS arises under section 195 of the Income-tax Act, 1961

7. The due date of payment of TDS on rent is thirty days from the end of the month in which the deduction is made. Example: For FY 2017-18, a taxpayer has to deduct and deposit TDS before 30th April 2018

For ease of filing of Form 26QC, I am sharing this excel utility which one can fill in first, take a print of same and then start filing it online. Download th excl utility from:

https://docs.google.com/spreadsheets/d/1FTuvAi0-8Syv9ZDpzU8HbVzNW_pGigz-1N-4yDPGOWw/edit?usp=sharing


Pay TDS on Rent of Property (Form 26QC) from:

https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp


Also see video for more details:



To know how to register new user and request Form 16C / TDS Certificate watch this video:





References:
1. https://www.tin-nsdl.com/faqs/tds-on-rent-of-property/TDS-Introduction.html
2. https://economictimes.indiatimes.com/wealth/tax/cut-tds-from-june-1-if-paying-rent-over-rs-50000-per-month-heres-how-to-do-it/articleshow/59575613.cms

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