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Taxation on lease rent

nitin (professional) (83 Points)

18 April 2014

Experts please advice......

The employee is provided with a company leased accomodation.

Q1. Does the lessor get 30% standand deduction benefit (as in case of income of house rent) while calculating his income?

Q2. The company is deducting flat 10% tds on the monthly lease rent, Is it according to the rules ( as the property is not for commertial purpose but for housing accomodation) ?

Q3. Can the lessor submit investment proof(under section 80C) to the company so that the TDS on the lessor income can be reduced?(Can you suggest any other method to reduce TDS?)

THANKS IN ADVANCE!!!

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4 Replies

Harendra Kumar (Tax Advisor ) (1326 Points)
Replied 18 April 2014

Sir,

They are deducted TDS on your payment and same you are eligible for Refund claim.

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Income Tax Wala: (Fin. Expert) (Chartered Accountants) (2015 Points)
Replied 18 April 2014

Dear Nitin

Q1 : lessor is eligible for 30% standered deduction on rent received.

Q2: 10% deduction of TDS on rent is absolutely as per rules.

Q3: in this situation proofs of investment u/s 80C do not work. and there is no method to reduce this TDS rate.

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CA Gaurav Mittal (Partner) (1230 Points)
Replied 18 April 2014

if i am correct, TDS need not be deducted if rent is less than Rs 180000 PA

Harish kumar goud (Finance Manager) (84 Points)
Replied 20 April 2014

It is better to approach your area assessing officer, assessing officer may issue a certificate for lower rate deduction of tds on your income if he satisfied with the information provided by you for lower rate of tds deduction. Tds not required to be deducted if your rental income is less than 180000.