TDS on rent, commission and purchase of goods
1 min read
Updated 03 Oct 2026
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AI summary
Three payments that businesses often miss, with the limits that trigger them.
4 sections
Rent
| Rent for | Rate | When |
|---|---|---|
| Land, building, office, warehouse, furniture | 10% | Rent above ₹50,000 a month |
| Plant, machinery, equipment | 2% | Rent above ₹50,000 a month |
- Deduct on rent without GST.
- A security deposit that is refundable is not rent. No TDS on it.
- An individual not under audit who pays rent above ₹50,000 a month deducts 2% and pays through Form 141, without needing a TAN.
Commission and brokerage
- 2% once commission to one person crosses ₹20,000 in the year.
- Trade discounts given on the invoice are not commission.
- Insurance commission: 2% (10% if paid to a domestic company).
Purchase of goods (old 194Q)
Applies only if your turnover last year was above ₹10 crore.
- Deduct 0.1% on purchases from one seller above ₹50 lakh in the year.
- Only the part above ₹50 lakh is taxed. Example: purchases of ₹80 lakh → TDS on ₹30 lakh = ₹3,000.
- Deduct when you book the bill or pay, whichever is earlier. If you pay an advance, deduct on the advance.
- No PAN from the seller: 5%.
Common mistakes
- Paying rent monthly below ₹50,000 but in lump sums above it. The monthly test looks at rent for the month, not the payment date.
- Forgetting that partner remuneration and interest now need TDS (10% above ₹20,000).
Law as of September 2026. Verify against the latest notifications before relying on it for filings.
Sources
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