Nri taxability in case of sale of property

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Querist : Anonymous

Querist : Anonymous (Querist)

05 August 2013 If NRI sales residential property to resident indian, what is TDS liability of resident indian?

Whether section 195 will apply?
If yes, Whether tds will be deducted on whole sale consideration or LTCG?

Is there any section in International Taxation which is beneficial for NRI?

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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06 August 2013 TDS is required to be deducted u/s 195 @ 20% + EC & SHEC on the whole sale consideration.

Surcharge of 10% will also be applicable if the amount paid exceeds Rs. 1 crore.

For benefit under International Taxation you will have to go through the DTAA between India & the country of which he is resident.

In case of doubt contact a CA.

Querist : Anonymous

Querist : Anonymous (Querist)

06 August 2013 Assessee is from UK, He have PAN card also. Please let me know Implication of DTAA.

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CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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06 August 2013 You will have to go through the DTAA between India & UK.

Alternatively you can contact a CA.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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06 August 2013 The new TDS rule will apply and the same is to be charged @1%

As regards provisions of Section 195 are concerned it will be applicable only when the proceeds are send to a foreign country but whether the money is sent or not the 1% TDS is a must and it cannot be avoided.

For capital gains TDs has to be deducted as per the 195 as suggested by the expert

Querist : Anonymous

Querist : Anonymous (Querist)

06 August 2013 Sir, But section 194 IA is not applicable on NON Resident as per Act language-

Payment on transfer of certain immovable property other than agricultural land.—(1) Any person, being a transferee, responsible for paying (other than the person referred to in section 194LA) to a resident transferor any sum by way of consideration for transfer of any immovable property (other than agricultural land), shall, at the time of credit of such sum to the account of the transferor or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to one per cent. of such sum as income-tax thereon.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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06 August 2013 Section 194LA is applicable only if payment is made to a RESIDENT.

In this case payment is made to a NON-RESIDENT. Accordingly Section 195 is applicable and TDS is required to be deducted @ 20% +EC & SHEC + Surcharge

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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06 August 2013 TDS u/s 194LA is not applicable to NRI even if he has valid pan card and hence no tds is to be deducted.

Sec 195 is correct section applicable in this matter.

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Querist : Anonymous

Querist : Anonymous (Querist)

06 August 2013 What is the ruling of below case:-

Supreme Court in the case of GE INDIA TECHNOLOGY CENTRE (P) LTD. vs. COMMISSIONER OF INCOME TAX & ANR. (2010) 44 DTR (SC) 201 overruling the decision of the Karnataka High Court in the case of CIT vs. Samsung Electronic Company Ltd. 320-ITR-209(Kar) -

Querist : Anonymous

Querist : Anonymous (Querist)

07 August 2013 Please give the answer.