Tds in case of payment of rent section 194i

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 December 2015 Hi

As per Sec 194I, TDS is to be deducted @10% on payment of rent if payment exceeds Rs. 1,80,000 p.a. Individuals and /or HUFs who are subject to tax audit are also under this obligation to deduct TDS. So, in case of sole proprietorship, if any individual ( say, Mr.A owner of sole prop business) pays rent of say Rs.2,00,000/- to the landlord of premises where Mr. A conducts business, he will deduct TDS @10%p.a., that is, Rs.. 20,000. Lets say Mr. A also pays a rent of his personal house of Rs. 3,00,000/- p.a. In this case, will Mr. A be required to deduct TDS even of the amount of rent (i.e. Rs. 3,00,000/-) he pays for personal house?

Any help would be appreciated.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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28 December 2015 As the concept of TDS U/s 194I is built on "income paid" rather than "expenditure incurred" , so the assessee is required to deduct TDS on Rs. 300000/- also.