Paying rent above ₹50,000 a month? A tenant's guide to TDS under section 393 and Form 141

Rules and rates as of 18 October 2026.

If you rent a flat for more than ₹50,000 a month, the Income-tax Act puts a job on you, the tenant: deduct tax from the rent, pay it to the government in your landlord's name, and give the landlord a certificate. Many salaried tenants in the big metros cross this line without knowing it, and the duty sits with the person paying, not the person receiving. From 1 April 2026 the rule lives in section 393 of the Income-tax Act, 2025, with new form numbers. This guide is written from the tenant's side: when it applies, what to do in March, and what a missed deadline costs.

Does it apply to you?

Section 393(1) of the 2025 Act has a Table of payments on which tax is deducted at source. Serial number 2 covers "any income by way of rent". It has two rows:

• Serial 2(i): the payer is a "person other than specified person". Rate 2%. Threshold: ₹50,000 for a month or part of a month.
• Serial 2(ii): the payer is a "specified person", broadly companies, firms and other entities, and individuals or HUFs whose business or professional receipts cross the limits set out in the department's FAQ. They deduct 10% on rent for land or buildings, every month.

A salaried employee renting a home falls in serial 2(i). The Income Tax Department's FAQ on TDS on rent says the duty arises if the rent for a month or part of a month exceeds ₹50,000 during the tax year. For 2(i), "rent" means payment for the use of land or a building, including land attached to it. The landlord must be a resident; rent paid to a non-resident landlord falls under different rules, which this guide does not cover.

When you deduct: once, at the end

Unlike a company, which deducts every month, an individual tenant under serial 2(i) deducts once a year. Note 1 to the Table says tax is deducted when rent is credited or paid, whichever is earlier, "for the last month of the tax year or the last month of tenancy".

So if you stay the whole year, you deduct from the March rent. If you move out in, say, September, you deduct from the September rent.

How much? The Act's page does not say in words whether the 2% applies to the whole year's rent. The official Form 141, though, asks for the "Total amount of rent credited/paid during the tax year" and the "Period of tenancy during tax year (in months)" before the amount on which tax is deducted, and the FAQ's cap for the no-PAN case (below) only makes sense on a base larger than one month. The examples below therefore apply 2% to the rent for the tenancy in the tax year. Check this reading with a chartered accountant before you file.

No TAN, one form, 30 days

The paperwork is lighter than for an employer:

1. No TAN. Section 397(1)(c) says a deductor under serial 2(i) need not apply for a tax deduction account number. You use your own PAN.
2. Get the landlord's PAN in writing before March. You will need it in the form.
3. Pay and report together in Form 141, a challan-cum-statement filed on the income-tax e-filing portal. The department's FAQ on Form 141 says it replaces the old Form 26QC for rent (Schedule A), payment is made electronically with the form, and it is due within 30 days from the end of the month in which you deducted.
4. Issue Form 132 to your landlord. You download it from TRACES once the statement is processed, and the FAQ on TDS on rent says it must be issued within 15 days from the due date of Form 141.

Two practical points from the Form 141 FAQ. One form covers transactions of the same nature with the same month of deduction. And where there are several payers, say two flatmates who each pay part of the rent, each deductor files separately for their proportionate share; one deductor can report several landlords in the same form, with each landlord's share. Whether the ₹50,000 test applies to the total rent or to each person's share in such cases is not addressed in the FAQs we read, so ask a chartered accountant.

If your landlord has no PAN

Section 397(2)(b) requires deduction at the higher of the normal rate and 20% when the payee does not give a PAN. For serial 2(i) rent, section 397(2)(e) caps the deduction at the rent for the last month of the tax year (or of the tenancy). In practice, that means you could end up keeping back a full month's rent.

Worked example: ₹60,000 a month

Assume you pay ₹60,000 a month to a resident landlord with a PAN, from April 2026 to March 2027. Figures computed by us, on the full-year reading explained above.

• Rent for the year = ₹60,000 × 12 = ₹7,20,000.
• TDS = 2% × ₹7,20,000 = ₹14,400, deducted from the March 2027 rent.
• You pay the landlord in March = ₹60,000 − ₹14,400 = ₹45,600, and ₹14,400 to the government through Form 141.
• Deadlines: deducted in March 2027, so Form 141 is due by 30 April 2027 (30 days from 31 March), and Form 132 by 15 May 2027.

Situation	Rent base	TDS	Deducted from
Full year, landlord gives PAN	₹7,20,000	₹14,400 (2%)	March rent
You move out after September	₹3,60,000	₹7,200 (2%)	September rent; Form 141 due 30 October
Full year, no PAN	₹7,20,000	20% = ₹1,44,000, capped at ₹60,000	March rent (the whole month)

What a missed step costs

Section 398 treats a person who does not deduct, or deducts but does not pay, as an "assessee in default", and charges interest:

• Not deducted on time: 1% for every month or part of a month, from the date tax was deductible to the date it is actually deducted (s.398(3)(a)(i)).
• Deducted but paid late: 1.5% for every month or part of a month, from the date of deduction to the date of payment (s.398(3)(a)(ii)).

On ₹14,400 deducted in March but paid two months late, interest would be 1.5% × 2 × ₹14,400 = ₹432. Section 398(2) also says you are not treated as in default for failing to deduct if the landlord has filed a return including that income and paid the tax, and you furnish an accountant's certificate to that effect.

Separately, section 427 charges a fee of ₹200 for every day a statement is late, capped at the tax deductible. The Form 141 FAQ confirms this fee applies to Form 141. Filing 20 days late on the example above would cost 20 × ₹200 = ₹4,000, well under the ₹14,400 cap.

What your landlord gets

The ₹14,400 is not a cost to your landlord. It is credited against their own tax for the year once your Form 141 is processed, and Form 132 is their proof. A wrong PAN in your form means the credit will not reach them, according to the Form 141 FAQ. Our separate guide for landlords explains how they compute and declare the rental income itself.

If your employer asks for rent receipts or the landlord's PAN for your own tax claims, that is a separate requirement from TDS, and your employer's payroll team or a chartered accountant can explain it.