🏠 TDS on Rent Calculator (Section 194IB: Rent > ₹50,000/mo)
📊 Your TDS Deduction Breakdown
How This TDS on Rent Calculator Works (Section 194IB)
Under Section 194IB of the Income Tax Act, any individual or HUF (not liable to tax audit) who pays rent exceeding ₹50,000 per month is required to deduct TDS at the rate of 5%. This TDS on rent calculator for amount exceeding ₹50,000 per month helps tenants quickly compute the exact deduction without needing a TAN (Tax Deduction and Collection Account Number).
Key Rules of Section 194IB
- Applicability: Only for individuals and HUFs whose books are NOT required to be audited.
- Threshold: Monthly rent must exceed ₹50,000.
- TDS Rate: 5% of the total rent. No surcharge or health & education cess is added.
- No TAN Required: Unlike companies, individuals can deduct this TDS using their PAN card.
- Deposit Deadline: TDS must be deposited using Challan ITNS 281 within 30 days from the end of the month in which deduction is made.
Step-by-Step Example Calculation
Let's take the example of Rohan, who rents an apartment in Bangalore for ₹60,000 per month. His landlord has provided a valid PAN card.
- Monthly Rent: ₹60,000
- Duration: 12 months
- Total Annual Rent: ₹60,000 × 12 = ₹7,20,000
- TDS Rate (with PAN): 5%
- Total TDS to Deduct: 5% of ₹7,20,000 = ₹36,000
- Net Rent Payable to Landlord: ₹7,20,000 - ₹36,000 = ₹6,84,000
Rohan will deduct ₹3,000 (5% of ₹60,000) every month, deposit it to the government, and pay the remaining ₹57,000 to his landlord.
Common Mistakes Tenants Make
- Ignoring Section 206AA: If the landlord does not provide a PAN, the tenant MUST deduct TDS at 20% instead of 5%. This tool accounts for that.
- Missing the Deadline: Failing to deposit the TDS by the 7th of the next month attracts interest at 1.5% per month.
- Not Issuing Form 16C: After depositing TDS, the tenant must generate and provide Form 16C to the landlord as proof of deduction.
❓ Frequently Asked Questions
Do I need a TAN to deduct TDS on rent under Section 194IB?
No, individuals and HUFs not liable to tax audit can deduct TDS under Section 194IB using their PAN card. A TAN is not required.
What if the landlord does not have a PAN card?
As per Section 206AA, if the landlord fails to provide a PAN, you are legally required to deduct TDS at a higher rate of 20% instead of the standard 5%.
When is the due date to deposit the TDS?
The TDS deducted under Section 194IB must be deposited to the government using Challan 281 within 30 days from the end of the month in which the rent was paid or credited.
Can I claim this TDS in my own Income Tax Return?
No, this TDS is deducted from the landlord's income, not yours. The landlord will claim this TDS credit in their ITR using Form 26AS.