TDS ON RENT TO NRI

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

14 May 2011 Dear All
Pleas through some light on this query..
One of our client has to make Rent Payment to NRI. Property situated in India and Cheque is deposited in Local Banks (personal A/c) in india in INR. What is the rate of TDS? Is it 10% U/s 194I or 30.90% U/s 195?? If it is U/s 195, do we have to obtain 15CB and file Form 15CA?? If NRI is in US, whether any special rates applicable Under DTA??
Pls clarify

Thanks in Advance

U S Sharma

U S Sharma (Expert)
Follow

14 May 2011 as the payment is made to indian bank in indian rupee, NRI status does not differ anything, subject to pan provided at the time of TDS, 10% TDS applicable u/s 194I

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)
Follow

14 May 2011 SECTION 194-I APPLIES ONLY IF PAYMENT IS AMDE TO A RESIDENT IN THIS CASE THE RECEIPIENT IS NOT A RESIDENT HENCE SECTION 195 WILL APPLY
TAX SHALL BE DEDUCTED AT 30.9 PERCENT
IN TERMS INDIA-USA DTAA AND SECTION 9 THE RENT INCOME WILL BE TAXED IN INDIA

AS PER SECTION 195(6) INFORMATION RELATING TO PYMT IS TO GIVEN TO AUTHORITIES IN F.No. 15CA/15CB

CA MANOJ GUPTA
JODHPUR
09828510543

Message likes : 2 times

Upgrade to CAclubindia Pro. Subscribe Now!

Querist : Anonymous

Querist : Anonymous (Querist)

15 May 2011 Sir

I have information that payment made to NRI for rent and the money is deposited in indian bank account than 15CA and 15CB will not be required.

I got this information orally without any document or circular or case law so is it correct or not please confirm.

if it is correct if possible give me the link of the document which suggest such that form 15CA and 15CB will not be applicable

Reply as early as possible.

Thank You

U S Sharma

U S Sharma (Expert)
Follow

15 May 2011 as the payment is made to indian bank, pan card is not on status of NRI, no such evidence is visible to deductor that the receipent is NRI, ( except the statement and knowledge)

The payment is related to the rent of property in india,

why the deductor should take hassle to establish the receipent as NRI, when all the factors are common as resident?

As the payment is deposited in indian rupee in indian bank, we belive that tax liability of the said receipent would file his return and discharge the tax liability if any.