• Filing form 26qc

I am tenant paying more than Rs 50000 rent monthly to landlord. Every month I pay the rent for the month on 10th. I missed the news that that TDS under section 194-IB of the Act has been reduced from 5% to 2% w.e.f October 1,2024. Accordingly, I had paid full rent amount on 10th October.

2. I usually deducted TDS on rent on yearly basis. Now that for remaining 6 months, rate is 2% and for the previous six months it was 5%, (a) how should I do the deduction and filing as only one rate is shown while filing Form 26QC? (b) If I deduct 5% while paying rent in November 2024 for the period Apr-Sep 2024, won't it lead to delayed payment of taxes? (c) Is there any way in which I can deduct TDS on yearly basis despite having different rates for the given year?
Asked 20 hours ago in Income Tax

As per the law, TDS is to be deducted on the last month of the financial year OR  the time of payment, whichever is earlier.  It seems you have made the payment of rent only on 10th October. So you can make the payment for TDS by 7 November.   

 

Ideally, you should deduct TDS as per the provision of law ie 5% till Sep and 2% thereafter. Since, the payment was not made earlier, it is not a delayed payment from your side.  In the From 26QC for date of credit or payment, kindly put 10 Oct. 

 

For the rates, if your landlord does not have issue for deduction of 5% for entire year, then you may show that rate. The government does not question when higher TDS is paid.  

Jasmina Jain Shah
CA, Greater Mumbai
456 Answers
4 Consultations

Ask a Chartered Accountant

Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
  Ask a CA