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Thursday, 6 June 2013

What to do?? TDS on immovable property u/s 194 IA :


Effective date
01/06/2013

What to do
Deduct tax @1%

When
While making payment of consideration to seller of property

Which Property
An immovable property the total consideration for which exceeds Rs.50,00,000/- (Rupees Fifty Lakhs)

Exemption
No TDS while dealing in RURAL Agricultural Land

Person Selling prop.
Must be a Resident

Person Purchasing
Can be any person


PROCEDURE TO BE FOLLOWED
Compliance of Rule/ Section
Procedure
Sec 194 IA
  • At the time of
  • payment (full or part payment) ,or
  • crediting the amount to the account of seller
  • whichever is earlier
  • deduct tax @ 1%
Rule 30 (2A)
Rule 30 (6A)
Rule 31A (4A)
·         Person purchasing property
·         To pay TDS,  within seven days from
·         The end of the month in which deduction is made
·         By a challan cum statement in form 26QB
·         ELECTRONICALLY
Rule 31 (3A)
·         Person purchasing property
·         To issue TDS certificate (Form 16B)
·         Downloaded from website
·         Within twenty two days from
·         The end of the month in which deduction is made.

Important to note that:
1.       At the time of payment via form 26QB an “E tax confirmation number” is generated, we must take a note of that, it will help us while downloading the TDS certificate form 16B from the website.
2.       Procedure for download of form 16B is not yet notified, it shall be communicated in future mails.
3.       In case the person selling the property does not have a pan, then a higher rate of 20% tax shall be levied.