How To Prevent TDS on Rent?

Dear Sir, My father aged 65 year has rented one floor to a college for making a private hostel for students on a monthly rent of Rs13500.Now the college authorities are saying to pay the rent after deducting the TDS.Kindly advise all provisions so that the college authorities can be guided not to do the TDS. 

Ajit Bhardwaj ,Chandigarh

The provision of tax at source from rent is contained in section 194-I of the  I T Act. Since , the monthly rent in your case is Rs 13,500 , which means that the total rent shall exceed     Rs 1,20,000 limit set for deduction of tax at source.  So, as per the provision , collage authorities are rightly saying that payments will have to be done after deducting tax at source.

How can you prevent?

Section 197  comes to your rescue. The said provision is as under

197. (1) Subject to rules made under sub-section (2A), where, in the case of any income of any person or sum payable to any person], income-tax is required to be deducted at the time of credit or, as the case may be, at the time of payment at the rates in force under the provisions of sections 192, 193, 194,194A, 194C, 194D, 194G, 194H, 194-I, 194J,194K ,194LA and 195, the Assessing Officer is satisfied] that the total income of the recipient justifies the deduction of income-tax at any lower rates or no deduction of income-tax , as the case may be, the Assessing Officer shall, on an application made by the assessee in this behalf, give to him such certificate as may be appropriate.

(2) Where any such certificate is given, the person responsible for paying the income shall, until such certificate is cancelled by the Assessing Officer, deduct income-tax at the rates specified in such certificate or deduct no tax, as the case may be.

Since , your father is senior citizen ,higher exemption limit up to Rs 2.25 lakhs are provided. It means that there is scope for your father to convince the A.O that there should not be TDS as total rent is not more than the exemption limit. Check what are other income. I feel there is good ground for application for issue of certificate for NIL deduction from A.O  .

Take following steps quickly

1. Download the form No 13 from here .

2.Fill up the form .

3.Visit the Assessing Officer under whom your father’s case is assessed and submit the application for lower rate or NIL rate.

4. Obtain the certificate  of A.O for NIL deduction and submit with the  college Authorities.

There will not be any deduction of tax or there will be deduction at a very lower .

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