New provision for tax on property dealing

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

05 June 2013 It came to my knowledge that 1 % tax will have to pay on property's sale & purchase over 50 lacs.Is this true. And this provision shall be applicable from June 2013.Please Clarify in this Matter & Be obilized.

Thank You,

Sumit Grover

Sumit Grover (Expert)
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06 June 2013 Yes, as per newly inserted section 194-IA, the buyer(I.e. Tranferee) needs to deduct TDS @1 percent of the consideration, at the time of credit or payment whichever is earlier... This provision is applicable in case the agreement to sell is entered on or after 1-jun-13 and the total consideration exceeds rs. 50 lakhs... A separate challan-cum statement(form 26qb) has been issued by CBDT in which d details of buyer and seller(alongwith their PAN nos. ) Need to be mentioned...

Anand

Anand (Expert)
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06 June 2013 In addition to what Mr Grover has opined
- As a buyer note that this is not an additional cost to you. You are required to deduct it from the consideration paid to the seller and deposit it to the credit of government in the prescribed challan cum statement.

- As a seller, the TDS is not a final tax. As in case of other TDS, you can claim adjustment of the same against your final tax liability based on the challan cum statement filed. So it has to be ensured that your pan details are properly mentioned on the challan by the buyer and the amount is reflected in your Form 26AS.