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T.C Krishna   19 January 2018

Tds on rent

Dear Friends

In this case,  company balance sheet for 2015- 2016 shows Rent Payable as 648000 and TDS on Rent as 72 0000.Company did not  deposit the   TDS amount to Gov. Company has not paid the Rent. It is due.

Should company deposit TDS  if the rent is due?

Please reply



 6 Replies

R.Ramachandran (Advocate)     19 January 2018

According to Section 194-I of the Income Tax Act, 1961, a person who is responsible for paying to a resident any income by way of RENT, 

shall deduct income tax (TDS) thereon, 

(i) at the time of credit of such income to the account of the payee or

(ii) at the time of payment thereof in cash or by the issue of cheque or draft or by any other mode,

whichever is earlier.

In your case, you have credited the 'rent' to the account of the payee in the Financial year 2015-16, though

you have not made actual payment thereof so far.

As you have credited in your books the rent to the account of the landlord in the year 2015-16 itself, point (i) above is the earliest point, and therefore you are liable to have deducted TDS from such credit and liable to pay to the govt. the TDS amount.

T.C Krishna   19 January 2018



" IS CREDITED TO THE ACCOUNT OF PAYEE "  MEANS  "Funds  deposited into account.?

R.Ramachandran (Advocate)     19 January 2018

No. It means when the amout is credited to the accounts of the Payee in your books of account.  The moment you credit, you correspondingly debit the expenditure in your books.  This is because you are maintaining the accounts on mercantile principle.  

If credited to the accounts of the Payee does not mean credited into the Bank account of the payee.

T.C Krishna   20 January 2018



Pankaj Yadav (MT)     20 January 2018

All the payments except salary payment need to pay TDS as soon as you book them in your book of accounts.Xtrack GPS Tracker

Registerexperts (company registeration)     29 January 2018

" IS CREDITED TO THE ACCOUNT OF PAYEE "  MEANS  "Funds  deposited into account.?


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