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A salaried individual who is not a specified person under section 393 pays a resident landlord rent of exactly ₹50,000 a month for his residence throughout tax year 2026-27. What must he deduct at…

Question and options

A salaried individual who is not a specified person under section 393 pays a resident landlord rent of exactly ₹50,000 a month for his residence throughout tax year 2026-27. What must he deduct at source under section 393(1) of the Income-tax Act, 2025?

  1. No deduction from any month's rent

  2. 2% of each month's rent, deducted monthly

  3. 10% of each month's rent, deducted monthly

  4. 2% of the year's rent, from the rent for the last month

Answer and explanation

Correct answer: A - No deduction from any month's rent

Section 393(1), Table item 2(i), of the Income-tax Act, 2025 requires a person other than a specified person to deduct 2% only when rent exceeds ₹50,000 for a month or part of a month, and then once, from the rent for the last month of the tax year or tenancy. Rent of exactly ₹50,000 does not exceed the threshold, so nothing is deducted; 10% is the rate for specified persons paying rent for land or buildings.

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