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Tds on prpperty (194ia) disallowances

AKKI SHARMA (Student CA IPC / IPCC) (88 Points)

10 October 2016

Dear all, My client has purchased a property and has not deducted TDS under section 194IA. Thus my query is whether the tds amt to be disallowed under section 40a. anser asap

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3 Replies

Rahul Shah (Assistant Chartered Accountant) (196 Points)
Replied 10 October 2016

My dear friend there is no such disallowance u/s 40(a) for Non Deduction of TDS in respect of Purchase of Property.

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CMA Poornima Madhava (CMA) (13112 Points)
Replied 10 October 2016

Agree with Rahul. Further, disallowance u/s 40(a) is in repsect of expenditure (not on TDS component alone). Moreover, it is not applicable in respect of property since it is an asset. In your case, if tax u/s 194IA is not deducted/paid, then interest for late deduction as well as late payment and late fee will be applicable. IT Dept would send notice damanding the same.