TDS on rent calculator: rent paid by an individual or a business
The short answer
- No TDS if the rent is ₹50,000 a month or less, whoever pays it.
- Rent paid by an individual above ₹50,000 a month: deduct 2% once a year, deposit with Form 141, no TAN needed.
- Rent paid by a business above ₹50,000 a month: deduct 10% (2% for machinery) at every payment, with a TAN.
You must deduct ₹18,000 and deposit it with the government. This falls under section 393(1), table 2(i) of the Income-tax Act 2025 (formerly section 194-IB), because the rent is above ₹50,000 a month and the payer is an individual or HUF not liable to tax audit. Deduct 2%. You deduct once, not monthly — in March, or in the last month of the tenancy if it ends earlier. Then deposit it with Form 141 (Schedule A), which replaced Form 26QC, within 30 days of the end of that month, and give the landlord the certificate in Form 132 (formerly Form 16C). You do not need a TAN — your PAN and the landlord’s are enough.
Runs entirely in your browser. Nothing is sent to us or stored. Rules as they stand for FY 2026-27 under the Income-tax Act 2025 — a guide for planning, not tax advice. Assumes the same rent every month.
What changed in 2025 and 2026
Most guides online still describe the old rules. Two changes matter:
- From 1 April 2025, the business threshold became monthly. The old test was ₹2.4 lakh a year. It is now ₹50,000 for a month or part of a month, the same line individuals use. Many sites restate it as “₹6 lakh a year”, which gives the wrong answer for a short or part-year tenancy.
- From 1 April 2026, the sections and forms were renumbered. The Income-tax Act 2025 moved TDS on rent into section 393(1). The rates and thresholds did not change.
| Until 31 March 2026 | From 1 April 2026 | |
|---|---|---|
| Rent paid by an individual or HUF | Section 194-IB | Section 393(1), table entry 2(i) |
| Rent paid by a business or audited payer | Section 194-I | Section 393(1), table entry 2(ii) |
| Deposit form (individual tenant) | Form 26QC | Form 141, Schedule A |
| Certificate to the landlord | Form 16C | Form 132 |
Rent paid or credited on or before 31 March 2026 still uses the old forms, even if you deposit the tax later.
TDS on rent paid by an individual vs a business
There are two sets of rules, and you do not choose between them: who is paying decides.
| Paid by an individual or HUF | Paid by a business | |
|---|---|---|
| Who | Individuals & HUFs not liable to tax audit | Businesses, and anyone liable to tax audit |
| Threshold | More than ₹50,000 a month | More than ₹50,000 a month |
| Rate | 2% (20% if no PAN, capped at one month’s rent) | 10% land/building/furniture · 2% plant & machinery |
| When | Once a year: March, or the last month of the tenancy | At each payment or credit |
| TAN | Not needed: your PAN and the landlord’s | Required |
| Forms | Form 141 (Schedule A) within 30 days; Form 132 to the landlord | Quarterly TDS return under your TAN |
How an individual tenant pays TDS on rent
- Get the landlord’s PAN at the start of the tenancy. Without it the rate is 20% instead of 2%.
- Pay the full rent every month. Do not hold back 2% each month.
- In March, or the last month of the tenancy, deduct 2% of the whole year’s rent from that month’s payment.
- Deposit it online with Form 141 (Schedule A) within 30 days of the end of that month, using your PAN.
- Download the Form 132 certificate and give it to the landlord, who claims the credit in their own return.
Three things people get wrong
The test is monthly, for everyone. Rent of ₹48,000 a month is ₹5.76 lakh a year, which sounds large, but it is under the ₹50,000 monthly line, so nobody deducts anything.
Individuals deduct once, not every month. Tenants who withhold 2% from each month’s rent leave the landlord short all year. The deduction happens in March, or in the final month if the tenancy ends earlier, and covers the whole period.
The no-PAN rate is capped. Without the landlord’s PAN an individual tenant deducts 20%, but never more than the last month’s rent. On a ₹75,000 tenancy running twelve months, 20% of ₹9 lakh would be ₹1.8 lakh; the cap brings it down to ₹75,000. The calculator applies this automatically.
Frequently asked questions
Do I have to deduct TDS on rent payment?
Only if the rent is more than ₹50,000 for a month or part of a month. Below that, no TDS is due, whoever is paying. Above it, an individual or HUF not liable to tax audit deducts 2% once a year, and a business or anyone liable to tax audit deducts 10% (2% for plant and machinery) at each payment or credit.
What is the TDS on rent paid by an individual?
2% of the rent, if the rent is more than ₹50,000 a month and the landlord has given their PAN. Without a PAN it is 20%, but never more than the last month's rent. The tenant deducts once, in March or in the last month of the tenancy if it ends earlier, and needs no TAN.
Which section covers TDS on rent from April 2026?
Section 393(1) of the Income-tax Act 2025, which replaced the 1961 Act from 1 April 2026. Rent paid by individuals and HUFs not liable to audit is in table entry 2(i), formerly section 194-IB. Rent paid by businesses and audited payers is in table entry 2(ii), formerly section 194-I. The rates and the ₹50,000 monthly threshold did not change.
What replaced Form 26QC and Form 16C?
From 1 April 2026, an individual tenant deposits TDS on rent with Form 141 (Schedule A), which replaced Form 26QC, within 30 days from the end of the month of deduction. The landlord's certificate is Form 132, which replaced Form 16C. Rent paid or credited up to 31 March 2026 still uses the old forms.
Is TDS on rent deducted every month?
Not by an individual tenant. They deduct once for the whole year, in March or in the last month of the tenancy, and pay it in one go. A business is different: it deducts at each payment or credit through the year.
Is the threshold for businesses still ₹6 lakh a year?
No. From 1 April 2025 the test for businesses became ₹50,000 for a month or part of a month, replacing the earlier annual limit. A business paying ₹70,000 a month for six months, ₹4.2 lakh in total, must deduct, even though the total is under ₹6 lakh.
Do I need a TAN to deduct TDS on rent?
Not as an individual or HUF tenant: your PAN and the landlord's PAN are enough. A business deducting TDS on rent does need a TAN.
Does this apply if my landlord is an NRI?
No. Rent paid to a non-resident follows separate rules, with different rates and a TAN requirement even for individuals. This calculator covers resident landlords only, so take advice for an NRI landlord.
TDS is decided by records you already keep
Whether you crossed the threshold, and for how many months, comes down to what each tenant paid. Nestwise keeps that ledger per tenant automatically, with rent, months, receipts and co-owner PAN attribution, so the answer is a lookup rather than a reconstruction in March. Free while in early access.
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