Tds on property purchase

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Querist : Anonymous

Querist : Anonymous (Querist)

24 April 2016 We,husband & wife,both earning NRIs jointly purchased an under construction property from Sobha group,against loan sanctioned from SBI. As per their practice, Sobha files 28QB on our behalf for every instalment and deposit the TDS,enabling us to download respective Form 16B. Everything has been smoothly going on till we realised that Sobha is filing the TDS against only one name ie my wife (may be because she is the first named in the sale agreement) But the IT rules says there should be 2 TDS filings for every payment, 50% against each of the joint buyers. We have a joint NRI a/c with SBI in India from which the moneys are going. Since eventually IT people will catch up with us,what can be done to rectify the mistake now ? Is it possible to correct the already filed Challans,from one name into two names ? By now 50% of the moneys have been paid,so can we now switch over to the 2nd name for remaining payments so as to comply with IT rules ?

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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24 April 2016 You don't need to worry... Just relax... Whatever tds was deposited in your wife name... Will be claimed by her only while filling of return of income... Since tds on property is just intimation of transaction in Immovable property to the govt.. I. E. It not income at all of the deductee... Simple book adjustment in your books, if maintained, is sufficient by treating it to loan and advances to each other, would be sufficient... Other view... You may request to deductor to revise their Tds return and mentioning your name in tds will also serve the same purpose... Thanks you...

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Querist : Anonymous

Querist : Anonymous (Querist)

25 April 2016 Thanks sir,the first part is understood. Also sir kindly give your comment on our next option ie filing the future/subsequent TDS challans in the name of the 2nd buyer ! Question arises because we both are salaried people and might have to show the payments /claim IT benefits/pay taxes for the house property !

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Abhishek Ranjan Singh

Abhishek Ranjan Singh (Expert)
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25 April 2016 Totally not agree with expert. First of you are the buyer so your are the deductor and you are responsible to deduct the TDS and file the return 26QB. In this case there is two buyer so TDS should be deduct from both the buyer and Form 26QB have to be filled in for the respective property shares.

In your case Both the option are open either you can Rectify the the earlier filed 26QB or show rest of TDS (50%) in your name and file the 26QB by your PAN. In my view second option is better and easy.

For better understanding you can following article :

http://taxguru.in/income-tax/notices-related-tds-immovable-property-purchase.html

@CA Mukesh : TDS deduction and filing the 26QB and providing the TDS certificate 16B is not a intimation of purchase of property, it is responsibility of buyer. Register and Bank will ask the the Form 16B at time of final payment and registration. For the default in filing 26QB will attract Penalty, Interest on TDS and trouble at the time of registration.

-Abhishek Ranjan Singh
ARS Solutions
www.arssolutions.co.in
+919022838615

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Querist : Anonymous

Querist : Anonymous (Querist)

25 April 2016 @ ARS: Thanks Abhishekji for the prompt answer,I shall go for the second option as per your advise. But just for my knowledge, is it possible ON LINE to correct the 26QB from single name to 2 names and split the amount or would it means seeking cancellation & refund of TDS already filed in single name and again refiling in 2 names with associated penalty,interest etc ?

Querist : Anonymous

Querist : Anonymous (Querist)

Abhishek Ranjan Singh

Abhishek Ranjan Singh (Expert)
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26 April 2016 In Simple words NO. so i told second option is better.

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Querist : Anonymous

Querist : Anonymous (Querist)

26 April 2016 Tahnks again,the query stands resolved !

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Querist : Anonymous

Querist : Anonymous (Querist)

27 April 2016 @ ARS: Dear Sir, With reference to the above query, we hear that a new on-line challan correction module has been added to CPC-TDS in the last few days. Through this module is it possible to add a new challan for the 2nd Buyer,at the same time halving the amount paid by the 1st Buyer,some kind of a book adjustment ! And if yes,will it involve Penalty,Late fee,Interest etc for the 2nd Buyer ? Pardon me if I sound absurd !

CA SUNIL K GARG

CA SUNIL K GARG (Expert)
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29 April 2016 As per on-line challan correction module, in case of physical forms, banks were permitted to correct data of challan relating to three fields only i.e. amount, major head code and name but with some condition. However in your case, bank can't alter this challan by adding 2nd Buyer. For any change in online challans, assessee can make a request for correction to his or her assessing officer only, who is authorized under the departmental OLTAS application to make such correction in challan data in bonafide cases, to enable credit of the taxes paid, to the concerned assessee.
In my opinion, You have to pay amount of 2nd buyer with interest.

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Querist : Anonymous

Querist : Anonymous (Querist)

03 May 2016 @Sunil Garg(Expert): Thanks Sir, That means we approach AO off-line to halve the amount of already filed challans in the name of 1st buyer. Will he refund the excess TDS amount of the 1st buyer and expect the 2nd buyer to file new challans for the balance half amount with interest ? Can we request AO to book-adjust the excess amount paid by the 1st buyer into the a/c of the 2nd buyer ?Sorry about complicating the matter !