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What is the Limit for TDS on Rent - Section 194I of Income Tax Act

What is Section 194I of the Income Tax Act?

Section 194IA - TDS on Sale of Immovable Property

Section 194IB - TDS on Rent by Individuals/HUFs

Section 194IC - TDS on Payment under Joint Development Agreement

What is the Importance of TDS u/s 194I?

Payments Covered Under Section 194I

TDS Rates Applicable Under Section 194I on Rent

TDS is applicable when the payee credits ‘income by way of rent’ to the landlord’s account. Note that if you receive rent through cheque, draft or cash, this tax will be deducted at the time of payment.

The table given below provides an insight into the 194I rent TDS rate based on the property type.

This includes the TDS rates applicable under 194Ia and 194Ib TDS on rent. Remember that the TDS Rate for invalid or no PAN is 20%.

Section and Nature of Payment Payer TDS Limit from 1 April 2025 (in ₹)  Applicable TDS Rate
Section 194I, TDS on rent  Individuals, except for taxpayers and HUF liable for audit  50,000 per month  2% (from machines or equipment)

10% (from land, buildings, and furniture)
Section 194IA, TDS on funds earned for transfer of immovable assets (except agricultural land)  Individual  50 lakh   1% 
Section 194IB, Rent by individuals & HUF  Individuals, except for taxpayers and HUF liable for audit  50,000 per month  2%  
Section 194IC, Payment on agreement  Individual  No threshold limit  10% 

Circumstances When TDS Under Section 194I is Not Deductible

Due Date to Deposit Tax

Penalty for Non-Deduction/Non-Payment of TDS

FAQs about Section 194I of Income Tax Act