When does TDS on rent apply under 194-IB?

When an individual/HUF tenant not under tax audit pays a resident landlord above Rs 50,000 in any single month. Deduct 2% once a year in the last month; companies and audited tenants use 194-I instead.

What if the landlord has no PAN?

TDS jumps to 20% of the rent. Always collect the landlord's PAN before signing.

What is the penalty for late Form 26QC?

Late filing attracts Rs 200 per day of delay, capped at the TDS amount, plus 1.5% monthly interest on unpaid TDS.

TDS on rent: the ₹50,000 tripwire most tenants miss

Individual/HUF tenants (not under audit) paying above ₹50,000/month deduct 2% TDS (5% before Oct 2024) — once a year, Form 26QC, no TAN.

Monthly rent (₹)Months in this FY Landlord PAN available?

TDS for the year (2%)

₹14,400

Deduct from the last month's rent (March, or last tenancy month): pay landlord ₹58,800 that month.

Then: Form 26QC within 30 days of month-end → Form 16C to landlord within 15 days of the 26QC due date. Late 26QC: ₹200/day (capped at TDS).

Steps on incometax.gov.in

Deduct 2% from last month's rent; pay landlord the net.
File challan-cum-statement Form 26QC online (your PAN + landlord PAN, no TAN).
Download and issue Form 16C to the landlord within 15 days of the 26QC due date.
Keep 26QC acknowledgement + 16C copy for your ITR file.

How this interacts with HRA & regimes →

The rules in 60 seconds

Who: individual/HUF tenants NOT under tax audit, paying a resident landlord above ₹50,000/month (any single month triggers it). Rate: 2% since 1 Oct 2024 (5% before). Timing: once a year, in the last month. Paperwork: 26QC in 30 days, 16C in 15 days. No landlord PAN: 20%.

Companies/audited tenants use 194-I instead (monthly, TAN, Form 26Q) — different track.
Vacated mid-year? Deduct in the last tenancy month, same 30-day clock.
Missed deadline interest: 1.5%/month on unpaid TDS.

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