TDS on rent above ₹50,000 a month: section 194-IB is now section 393(1)

Who has to deduct TDS on rent under the old section 194-IB?

The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026. Rent paid to a resident landlord is now in serial number 2 of the table in section 393(1). Who deducts, and how much, depends on whether you are a "specified person".

A "specified person" is defined in section 402(37). It is any company, firm, LLP, trust or other person that is not an individual or HUF. An individual or HUF becomes one only if their business turnover was above ₹1 crore, or professional receipts above ₹50 lakh, in the previous tax year. A salaried person renting a home is almost never a specified person.

• It applies to residents only. If your landlord is an NRI, different rules apply from the first rupee. See TDS on rent paid to an NRI.
• It is about the monthly rent. The test is rent above ₹50,000 for a month or part of a month. A tenant paying ₹50,000 exactly, or less, does not deduct under this rule.
• It covers homes and shops. The table says "any income by way of rent", so it is not limited to houses.

How much TDS do you deduct, and when?

Under section 393(1)(a), tax is deducted on the entire amount once the threshold is crossed, not only on the part above ₹50,000. Note 1 to the table says that for Sl. No. 2(i), you deduct at the time you pay or credit the rent for the last month of the tax year or the last month of the tenancy, whichever is earlier. So you deduct once, from the final month's rent, for the whole period.

If the tenancy ends in, say, October, the October rent is the last month of the tenancy, so you deduct then: 2% of the rent for April to October.

How do you pay the TDS and file Form 141?

Form 141 replaced Form 26QC. It is a challan-cum-statement: you pay the TDS and report it in the same form (Form 141 on the e-filing portal).

1. 1

   You don't need a TAN

   A tenant deducting under Sl. No. 2(i) is exempt from getting a TAN (section 397(1)(c)(i)). You file with your own PAN.

2. 2

   Log in with your PAN

   Form 141 can be filed only through the PAN login on the e-filing portal (Form 141 FAQs). Choose Schedule A, which is for TDS on rent paid by an individual or HUF.

3. 3

   Enter the landlord and rent details

   The landlord's PAN, the property, the rent and the month of deduction. If there are two landlords, such as joint owners, ask your CA how to split the deduction between them.

4. 4

   Pay within 30 days of the month-end

   The TDS must be paid within 30 days from the end of the month in which you deducted it, with Form 141, and the form furnished within one month from the end of that month (Form 141 FAQs). For TDS deducted from March rent, that means by 30 April.

5. 5

   Give the landlord the TDS certificate

   After filing, download the TDS certificate from the TDS-TRACES portal and send it to your landlord (Form 141 FAQs). They need it to claim the 2% as tax already paid.

What should the landlord do?

• Give the tenant your PAN in writing before the first rent payment. Without it, the tenant deducts 20%, up to one month's rent.
• Expect less rent in the last month. Agree in the rent agreement that the tenant will deduct TDS from the March rent (or the last month) and send you the certificate. See our rent agreement format.
• Check the TDS against your PAN in your Annual Information Statement on the e-filing portal.
• Claim the TDS in your return. Report the full rent as income and claim the TDS as tax paid. Work out the tax on that rent with our rental income tax calculator.

Keep a clean record of every rent payment

Form 141 asks for the rent for the whole period, so tenant and landlord both need the same monthly figures. Mismatched numbers are what usually goes wrong.

Frequently asked questions