New Delhi, July 8 -- If you are paying rent of more than Rs.50,000 a month, you need to deduct TDS before making the payment to your landlord. The Income Tax Act places TDS obligations on tenants paying high monthly rent.

The rules are laid down under Section 194-IB of the Income Tax Act, 1961. Failure to comply can result in interest charges, penalties and notices from the Income Tax Department.

Here's what you need to know.

Section 194-IB applies to individuals and Hindu Undivided Families (HUFs) who are not required to get their accounts audited under Section 44AB. This means even salaried taxpayers, who may have no business income, fall under its scope.

If the monthly rent paid to a resident landlord exceeds Rs.50,000, the tenant ...