TDS ON RENT U/s 194 I

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

27 January 2011 AS WE KNOW PAYMENT OF RENT ABOVE 180000/- ATTRACTS TDS U/s 194 I.

PRESENTLY OUR COMPANY IS PAYING RENT @ 20000/- P.M AS PER THE RENT AGREEMENT AND TDS IS DEDUCTED @ 10% AS PER THE ABOVE SECTION SINCE THE TOTAL RENT PAYABLE PER ANNUM IS CROSSING THE LIMIT OF RS. 180000/-.

NOW MY QUESTION IS :

IS IT POSSIBLE FOR MY COMPANY TO ENTER INTO A NEW AGREEMENT BY SPLITTING THE TOTAL RENT OF RS. 20000/- INTO TWO COMPONENTS IN THE SAME AGREEEMENT i.e.,

1. RENT AS 15000/- P.M AND
2. MAINTENANCE CHARGES AS 5000/- P.M .

OR SHOULD THE COMPANY ENTER INTO TWO SEPARATE AGREEMENTS i.e.,
ONE FOR PAYMENT OF RENT AND
ANOTHER FOR MAINTENANCE CHARGES SO AS TO AVOID TDS.

LET ME TELL YOU THE RECIPIENT OF RENT IS SINGLE PERSON ONLY.
PLEASE CLARIFY.

CA Punit

CA Punit (Expert)
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27 January 2011 TDS will still be applicable.....
as any payment by whatever name called will be considered rent.

Vivek Raju P

Vivek Raju P (Expert)
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27 January 2011 I think TDS will still be applicable as 194 I states that "any payment by whatever name called.... for the use of.."

So maintainance charges have a nexus with the usage of the property and TDS will get attracted.

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CA.ViVeK M ACA

CA.ViVeK M ACA (Expert)
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27 January 2011 TDS will be attracted even if the rent is splitted in to rent and maintanence charges as the section stipulate the word any payment made..