What is the threshold and rate for TDS on rent under Sections 194-I and 194-IB?
Category
Rates & sections
Answered by
A CA firm
Bottom line
Businesses deduct under 194-I (10% on land/building, 2% on plant & machinery); individuals/HUF not under audit deduct 2% under 194-IB once monthly rent exceeds ₹50,000.Section 194-I applies to most businesses and professionals under tax audit: 10% on rent for land, building or furniture and 2% on rent for plant and machinery. From FY 2025-26 the threshold is ₹50,000 per month.
Section 194-IB applies to individuals/HUF not liable to tax audit who pay rent above ₹50,000 per month — deduct 2% once in the year (in the last month of tenancy or the year), no TAN required. Always confirm the current threshold against the rate chart before deducting.
General information for FY 2026-27 under the Income-tax Act 2025, not advice on your specific case. Verify against the latest law or ask a CA before acting.