This discussion clarifies IT TDS (Tax Deducted at Source) liability when a construction company (B) purchases a landowner's (A) share of a property. If the total consideration for this share is below £50 lakh, and the agreements for the land and construction are not combined, then TDS under Section 194IA is generally not applicable. This holds true even if the buyer is a partnership firm and the transaction is based on the Fair Market Value (FMV) of the property.
08 July 2024
Land owner is "A", construction on it is done by "B".After the completion of construction, A's share is purchased by "B" & payment of same is below 50lakhs.
Does it attracts any TDS deduction liability on part of "B"?
09 July 2024
If total consideration of such transaction is below 50 lakh then any TDS provision would be attracted? Note: Agreement is done as per FMV of property.