Calculator for TDS on Rent Paid to NRIs
Easily calculate TDS on rent paid to NRI property owners
TDS (Tax Deducted at Source) on rent payments depends on the landlord's residency status. For resident Indian landlords, TDS is 5% and applies only if rent exceeds ₹50,000/month. But for NRI landlords, a flat 31.2% TDS is mandatory from the first rupee, as per Section 195 of the Income Tax Act.
This tool helps you quickly calculate the TDS on rent paid to NRIs, just enter the monthly rent, and it does the rest. It also includes helpful guidance on how to deduct TDS and file TDS returns.
Enter Monthly Rent
TDS
₹ 3,120
Rent to be paid
₹ 6,880
Provisions for TDS While Renting an NRI Property
According to Section 195 of the Income Tax Act, 1961, any individual residing in a property owned by a Non-Resident Indian (NRI), or any person/entity making rental or interest payments to an NRI or a foreign company, is mandatorily required to deduct TDS at the rate of 31.2% on the amount paid. The deducted TDS must be deposited with the government by the 7th day of the following calendar month.
Example
Mr. Kunal, an NRI, has let out his property to Ms. Agrawal for a monthly rent of ₹40,000. As per Section 195, Ms. Agrawal must deduct 31.2% TDS from the monthly rent before paying the landlord.
Therefore, the actual amount payable to Mr. Kunal is: ₹40,000 - (31.2% of ₹40,000) = ₹27,520.
The deducted TDS of ₹12,480 must be deposited with the Income Tax Department.
Tax Rates Applicable
The tax must be deducted from the rent payable at 31.2% (30% TDS + 4% cess on TDS). The above rate is applicable unless the NRI landlord has obtained a lower TDS certificate under Section 197. In such cases, the deductor must deduct TDS at the reduced rate specified in the Assessing Officer’s order.
How to Deduct Tax and File Returns?
First, tenants must get a tax account number (TAN) via the NSDL Website.
Once the TAN number is issued, the tenant must deduct TDS at 31.2% through Challan ITNS 281 within the seventh day of the following calendar month.
The rest of the rent amount should be paid to the NRI property owner.
After the TDS is deposited, the tenant should furnish a quarterly TDS Return in Form 27Q.
The tenant must also issue a TDS certificate to the NRI landlord in Form 16A. This form can be downloaded from the TRACES website within 15 days of the due date of filing the return.
How to pay rent TDS using challan ITNS 281?
Navigate to the “e-Pay Tax” portal of the Income Tax Department on Website to make direct tax payments.
Log in with TAN
Select “Pay TDS under section 195 (code 195)”
TDS/TCS Payable by Taxpayer (200)
Other than Company Deductee - Income Tax (Other than Companies) (0021)
How to File Form 27Q?
Go to the protean-tinpan website.
Navigate to the Downloads section menu bar, then select “e-TDS/e-TCS” then “quarterly returns” and then “regular” (for first-time filing).
Download the RPU software. In the RPU, choose Form 27Q and select “regular” again.
Input your TAN number, financial year, quarter, and personal information (including branch as 'none').
Add the TDS payment information from your challan (amount, BSR code, serial number, date of deposit).
Fill Deductee Details (Annexure 1), enter seller's information including PAN, payment details, and TDS deduction information.
Create & Validate File
Click 'create file'
Download the challan file (CSI) from the ITR portal.
Browse and select this file in RPU
Validate to generate the .fvu file
Upload & Submit
Log in to the income tax website with your TAN
Navigate to file Form 27Q
Attach the .fvu file
Complete e-verification using a Digital Signature Certificate or OTP.
Timelines and Due Dates
Monthly TDS Deduction
TDS on rent must be deducted monthly, from the total rent paid to the NRI landlord. The deducted amount should be deposited by the 7th day of the following month.
Quarterly Returns
A quarterly TDS return in Form 27Q must be filed, detailing the TDS deductions made during the quarter. For example, you must file returns by 31st July 2025 for the TDS on rent paid for April, May, and June 2025.
Annual TDS Certificate
An annual TDS certificate in Form 16A should be generated from the TRACES portal within 15 days of the due date for furnishing TDS returns and must be provided to the NRI landlord.
Penalty for not paying TDS
If the tenant fails to deposit the TDS to the government within the specified time, i.e., by the 7th of the following month, it attracts prosecution under Section 276B of the Income Tax Act, 1961. This may lead to imprisonment for a period ranging from 3 months to 7 years.
In cases where the tenant entirely neglects to deduct TDS from the rent paid to the NRI landlord, Section 271C of the Income Tax Act imposes a penalty equivalent to the amount of TDS that should have been deducted. Additionally, interest charges will also apply for delayed deduction or deposit of TDS.
Frequently asked questions
What is the NRI Rent TDS Calculator?
Who needs to deduct TDS on rent paid to NRIs?
When should I deposit the TDS amount?
What forms are involved in TDS compliance?
What are the penalties for late or non-payment of TDS?
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