₹ TaxSetu 2025
TDS — Rent (FY 2026-27)

TDS on Rent: 194-I vs 194-IB Rate, ₹50,000 Limit & Form 26QC

Company tenant: 10% above ₹50,000/month (194-I). Individual/HUF tenant: 2% above ₹50,000/month (194-IB, cut from 5%) — no TAN needed, pay via Form 26QC.

Which section applies to you?

194-I (business tenants)194-IB (individual/HUF, no audit)
Who deductsCompanies, firms, individuals under tax auditSalaried/self-employed individuals & HUFs
Threshold₹50,000/month (₹6L/year) per landlord₹50,000/month
Rate (FY 2026-27)10% land/building; 2% plant & machinery2% (5% before 1-Oct-2024)
TAN needed?Yes + quarterly returnsNo — challan-cum-statement in Form 26QC
Landlord has no PAN?20% TDS u/s 206AA — always collect the PAN

194-IB example — ₹60,000/month rent

Example — tenant's monthly math
Rent ₹60,000 exceeds ₹50,000, so 194-IB applies. TDS = 2% × ₹60,000 = ₹1,200/month (₹14,400/year). Pay the landlord ₹58,800; deposit ₹1,200 with the government. Deduct once a year — in March, or the last month of tenancy — and deposit within 30 days via Form 26QC.

Form 26QC in 5 steps

  • Go to the e-filing portal → e-File → e-Pay Tax → Form 26QC (tenant + landlord PAN required).
  • Enter rent details, tenancy period and TDS (2% of total rent).
  • Pay online — this single challan is both payment and statement; no separate TDS return.
  • Download Form 16C (TDS certificate) and share it with your landlord.
  • Verify the credit appears in the landlord's Form 26AS/Form 168.
Paying rent but claiming HRA? The exemption follows the least-of-3 formula and the new 8-city 50% list. HRA guide → · Full TDS chart (Sec 393) →

By TaxSetu Editorial Team · Last reviewed: 7 October 2026

Based on the Income-tax Act 2025, Income Tax Rules 2026 and CBDT notifications; sections per the Income-tax Act 1961 (as amended) with 2025-Act mappings where notified · Verify on the official portal: incometax.gov.in

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Frequently Asked Questions

2% under Section 194-IB when monthly rent exceeds ₹50,000 (reduced from 5% w.e.f. 1-Oct-2024). No TAN is needed — deposit via Form 26QC.

No — 194-IB triggers only above ₹50,000 in any single month. But 194-I's ₹50,000/month (₹6L/year) threshold applies if the tenant is a company or audit-case individual.

Not under 194-IB — individuals/HUFs use the challan-cum-statement Form 26QC instead. TAN plus quarterly returns are needed only under 194-I.

Deduct TDS at 20% instead of 2% under Section 206AA. Always collect the landlord's PAN before paying rent.