My brother has rented his 3 bhk flat in bangalore. Currently he stays in US. The rent collected from the flat is subjected to 30% TDS. Need advice if there is a way to avoid/reduce taxation on this. This is his only source of income in India.
Hi
Your brother may apply for a low deduction certificate to the jurisdictional AO. This would be done online through income tax portal.
The lower rate of TDS shall depend on his taxes payable in India. Once such certificate is obtained, the tenant shall deduct TDS on such rate as prescribed in the certificate.
If there are no taxes payable, he may apply for a NIL deduction certificate as well.
We may assist you with the same.
- Apply for lower tax deduction certificate and submit it to the tenant. It can be applied online. You need to register on the TRACES website as taxpayer. After registration, under the TAB"Statements/Forms" select Form 13. Fill all the information carefully and correctly and submit it. It will go to the TDS AO and after approval by him, certificate will be generated. Submit the certificate to the deductor.
Yes he can apply for lower tax deduction certificate with his AO i.e. assessing officer if this is his only income u/s 197 of the income tax act and save some TDS deduction.
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Thank you
Hello,
Your brother will have to apply to the AO for lower deduction certificate for his rental income. This can applied online on the traces portal. According to the certificate, the rate of TDS might be reduced.
I hope this answer satisfies your requirement.
Regards,
CA Hunny Badlani
Dear Sir,
Section 197 of the Income Tax Act, 1961 provides for the facility of NIL deduction of tax at deduction at a Lower rate of tax. To avail of this benefit, the assessee whose TDS is likely to be deducted on certain receipts should make an application before the TDS Assessing Officer who has a jurisdiction over his/ her/ its case. The deductee concerned may apply for a certificate for Nil or lower deduction of TDS on their receipts in Form No 13.
Once the certificate received by deductee, he/she/it can submit to Deductor to deduct the TDS at NIL rate or lower rate.
Deductor has to give this certificate details while filing TDS return and has to validate before filing. 197 certificate should be of 10 digit alpha & numeric number. Ex.1234AAAA45A1.
We may help you in entire procedure.
