Tds on immovable preoperty
This query is : Resolved
06 July 2013
Respected Sir,
I have some doubts on TDS at immovable property, I have purchased a property above Rs.50,00,000/- and paid an advance of Rs.48,00,000/- approx before 31.03.2013 and paid a sum of Rs.7,00,000/- after 01/06/2013, my question is on what amount should i deduct TDS on above Rs.50,00,000/- or on full sale consideration. Please guide me accordingly. Stamp duty & registration not done yet.
Thanking You
I have some doubts on TDS at immovable property, I have purchased a property above Rs.50,00,000/- and paid an advance of Rs.48,00,000/- approx before 31.03.2013 and paid a sum of Rs.7,00,000/- after 01/06/2013, my question is on what amount should i deduct TDS on above Rs.50,00,000/- or on full sale consideration. Please guide me accordingly. Stamp duty & registration not done yet.
Thanking You
08 July 2013
The 2013 Budget inserted After section 194-I of the Income-tax Act, the following section with effect from the 1st day of June, 2013, namely :—
‘194-IA. 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.
(2) No deduction under sub-section (1) shall be made where the consideration for the transfer of an immovable property is less than fifty lakh rupees.
Explanation.—For the purposes of this section,—
(a) "agricultural land" means agricultural land in India, not being a land situate in any area referred to in items (a) and (b) of sub-clause (iii) of clause (14) of section 2 ;
(b) "immovable property" means any land (other than agricultural land) or any building or part of a building.’.
Accordingly, it is clear that you have to deduct 1% TDS on Rs. 55 Lakh presuming the property purchased is not an agriculture land.
Since, consideration is more than Rs. 50 lakh you should have paid 1% TDS at the time of making payment of Rs. 48 Lakh and also at the time of making the balance payment as the TDS is to be paid at the time of payment or making a credit thereof which ever is earlier.
By the way the amount of TDS is a part of the consideration payable and has to be adjusted towards amount payable to the seller unless otherwise specifically provided or agreed.
‘194-IA. 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.
(2) No deduction under sub-section (1) shall be made where the consideration for the transfer of an immovable property is less than fifty lakh rupees.
Explanation.—For the purposes of this section,—
(a) "agricultural land" means agricultural land in India, not being a land situate in any area referred to in items (a) and (b) of sub-clause (iii) of clause (14) of section 2 ;
(b) "immovable property" means any land (other than agricultural land) or any building or part of a building.’.
Accordingly, it is clear that you have to deduct 1% TDS on Rs. 55 Lakh presuming the property purchased is not an agriculture land.
Since, consideration is more than Rs. 50 lakh you should have paid 1% TDS at the time of making payment of Rs. 48 Lakh and also at the time of making the balance payment as the TDS is to be paid at the time of payment or making a credit thereof which ever is earlier.
By the way the amount of TDS is a part of the consideration payable and has to be adjusted towards amount payable to the seller unless otherwise specifically provided or agreed.
08 July 2013
Dear Sir,
With due respect to the above query, the amount of Rs.48,00,000/- has been paid before 31/03/2013 and Rs.7,00,000/- paid after 01/06/2013 and I heard that till Rs.50,00,000/- it is exempt, then please guide that how I can calculate the same?
Thanking You
With due respect to the above query, the amount of Rs.48,00,000/- has been paid before 31/03/2013 and Rs.7,00,000/- paid after 01/06/2013 and I heard that till Rs.50,00,000/- it is exempt, then please guide that how I can calculate the same?
Thanking You
08 July 2013
Total consideration receivable is 55 lakhs out of which a part consideration is paid
The section only say the the TDS is to be deducted,(in this case), at the time of paying the consideration. It is not specified in the section that it is full or part not and therefore it is appropriate to deduct the tax
The section only say the the TDS is to be deducted,(in this case), at the time of paying the consideration. It is not specified in the section that it is full or part not and therefore it is appropriate to deduct the tax
08 July 2013
Dear Sir,
This is to mean that shall i deduct the TDS on the full amount of Rs.55,00,000/- what i paid till yet before 31/03 and after 01/06 and also on the balance amount what i have to pay in the future...
This is to mean that shall i deduct the TDS on the full amount of Rs.55,00,000/- what i paid till yet before 31/03 and after 01/06 and also on the balance amount what i have to pay in the future...
08 July 2013
Since, words used are "credited or paid" and you have not credited the amount to the account of seller, it follows that TDS should be deducted and deposited acordingly.
08 July 2013
Dear Rajendra,
I did not notice that date of first payment by you. Since it is before the provision become applicable, you need to deduct TDS now only on 55 lakh
I did not notice that date of first payment by you. Since it is before the provision become applicable, you need to deduct TDS now only on 55 lakh
10 July 2013
Dear Sir, I have already paid/credited Rs.44,00,000/- before 31/03/2013, it means TDS will not going to applicable on Rs.44,00,000/- and second payment i made after 01/06/2013 and deduct the TDS on second payment amount and i will deduct the TDS on the balance amount payable.Please guide me accordingly.
10 July 2013
Even if you have paid Rs. 44 lakh before 31.03.2013 But transaction is completing now and the consideration is more than 50 lakh. To avoid any kind of inconvenience in future you should deduct now and deposit TDS
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