TDS ON RENT

[pradip patwardhan]

Dear Experts, We are at pvt ltd co. paying rent on accomodation of our labour to another pvt ltd. co. Rent amount is 15,000 P.M. and we are paying Electricity bill of that premises which is 5000/6000 p.m. My query is whether TDS is applicable on this rent amount as the total rent amount is 1,80,000/- (excluding electricity amount) or whether electricity bill amount will be the part of rent?? kindly suggest...

Awaiting your rply...

Regards,

Pradip Patwardhan

 

[sanjay soman]

It depends on the rent agreement  made by you. If Electricity charges are to be borne by the tenant and rent is below Rs.180000/- p.a there is no need to deduct the TDS. If  you agreement says that rent is inclusive of electricity charges  and total rent will be Rs.15000/- plus elect. charges then you have to deduct the TDS. Because it will be only rent, irrespective whatever charges you have covered in rent amount.This is my opinion.

AI Summary

TDS on rent applies where electricity charges are contractually included in rent, requiring deduction when total contractual rent exceeds threshold. Whether withholding tax on rent applies depends on the rent agreement: if electricity charges are separately borne by the tenant they are excluded from rent for TDS threshold purposes; if electricity is included within the contracted rent, those charges form part of rent and must be aggregated with rent to determine the obligation to deduct TDS.