Naveen Kumar (IT) 17 May 2012

Tds on rental office from hmda

Dear Sir,

We have singed a lease agreement with HMDA (Hyderabad Metropolitan Development Authority, a government of Hyderavad enterprises) and the total monthly rental is Rs. 48,000/- + 12.33% service tax.

My question is do we need to deduct TDS on the monthly rent paid to them. If so how much as this is governemnt enterprises and they are not raising monthly invoise we need to pay as per the rent agreement.

Regards,

Naresh

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A V Vishal (Advocate) 17 May 2012

Originally posted by :Naveen Kumar
"	Dear Sir, We have singed a lease agreement with HMDA (Hyderabad Metropolitan Development Authority, a government of Hyderavad enterprises) and the total monthly rental is Rs. 48,000/- + 12.33% service tax. My question is do we need to deduct TDS on the monthly rent paid to them. If so how much as this is governemnt enterprises and they are not raising monthly invoise we need to pay as per the rent agreement. Regards, Naresh	"

Section 194-I deals with tax deducted at source on rent payment .Department has issued various circular on this subject.Summarised view of the relevant circular related to TDS on rent has been given below

Non-applicability to payments to certain entities - There is no requirement to deduct income-tax at source on income by way of ‘rent’ if the payee is the Government. In the case of the local authorities and the statutory authorities, there will be no requirement to deduct income-tax at source from income by way of rent if the person responsible for paying it is satisfied about their tax-exempt status under clause (20) or (20A) of section 10 on the basis of a certificate to this effect given by the said authorities.