Missed TDS on rent can lead to notices from the tax department for tenants claiming HRA without deduction. ​ Trigger for Notices Tenants claiming House Rent Allowance (HRA) but not paying TDS are receiving notices from the income tax department. ​ Notices are being sent for the financial year 2024 and earlier periods. Reason for Notices ​ The tax department is verifying the legitimacy of HRA claims due to the absence of TDS payment. ​ Tenants may need to file an updated income tax return if required. ​ Affected Individuals Genuine claimants may not have issues proving HRA validity but could still face penalties for not paying TDS. ​ TDS Payment Requirements Tenants paying rent above a certain threshold must deduct TDS before making payments. ​ Relief Options Section 201 provides relief if the landlord has already paid tax on the rent. ​ Penalties for Non-Compliance ​ 1% interest per month for unpaid TDS. 1.5% interest per month for TDS deducted but not submitted. ​ ₹200 per day penalty for delays in filing Form 26QC, capped at the TDS amount. ​ Discretionary penalties equal to unpaid TDS can be imposed under Section 271C. ​