Regarding 194ia- tds on property
This query is : Resolved
20 October 2015
Dear all,
If any Non resident purchased property in India, as per Section 194 IA he is liable to deduct TDS @1% if seller is resident. Can non resident claim this TDS as refund while filling his Income tax return?
If any Non resident purchased property in India, as per Section 194 IA he is liable to deduct TDS @1% if seller is resident. Can non resident claim this TDS as refund while filling his Income tax return?
20 October 2015
No ,but the seller can claim while computing capital gains tax.
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23 November 2015
But the NR who purchased that house is now using this as his residential house for his parents in India.
How should I get that money which is deducted as TDS as refund in that case?
How should I get that money which is deducted as TDS as refund in that case?
20 July 2025
Here’s the clarification on TDS under Section 194-IA for property purchase by a non-resident (NR):
Situation Recap:
Non-resident (buyer) buys property in India.
Buyer deducts TDS @1% on payment to seller (who is resident).
Buyer uses property as residential house for his parents in India.
Key points:
Who deducts TDS under Section 194-IA?
Buyer (payer) deducts TDS @1% on property purchase amount if seller is resident.
Can the buyer (non-resident) claim refund of this TDS?
No. The TDS is deducted on seller’s behalf and is credit to the seller’s PAN/account.
Buyer cannot claim refund of this TDS amount.
Who can claim the refund of TDS?
The seller (resident person) can claim the TDS credit/refund by showing it in their Income Tax Return (ITR).
If the buyer is non-resident but using the property for residential purposes:
This does not change the TDS rule.
TDS is on seller’s income (sale consideration), so only seller can claim.
For the buyer (non-resident):
No refund of TDS deducted under 194-IA is possible to the buyer.
Buyer should ensure TDS certificate (Form 16B) is obtained and given to the seller.
Summary:
The TDS deducted under Section 194-IA is always on the seller’s income, so only the seller can claim credit or refund of TDS. The buyer, resident or non-resident, cannot claim refund of this TDS.
Situation Recap:
Non-resident (buyer) buys property in India.
Buyer deducts TDS @1% on payment to seller (who is resident).
Buyer uses property as residential house for his parents in India.
Key points:
Who deducts TDS under Section 194-IA?
Buyer (payer) deducts TDS @1% on property purchase amount if seller is resident.
Can the buyer (non-resident) claim refund of this TDS?
No. The TDS is deducted on seller’s behalf and is credit to the seller’s PAN/account.
Buyer cannot claim refund of this TDS amount.
Who can claim the refund of TDS?
The seller (resident person) can claim the TDS credit/refund by showing it in their Income Tax Return (ITR).
If the buyer is non-resident but using the property for residential purposes:
This does not change the TDS rule.
TDS is on seller’s income (sale consideration), so only seller can claim.
For the buyer (non-resident):
No refund of TDS deducted under 194-IA is possible to the buyer.
Buyer should ensure TDS certificate (Form 16B) is obtained and given to the seller.
Summary:
The TDS deducted under Section 194-IA is always on the seller’s income, so only the seller can claim credit or refund of TDS. The buyer, resident or non-resident, cannot claim refund of this TDS.
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