TDS on immovable property 194IA credit in income tax return

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When purchasing immovable property, the TDS deducted under Section 194IA is for the benefit of the seller (builder or individual), who can claim it as a credit in their income tax return. While the TDS payment may appear in the buyer's Form 26AS, indicating the transaction, it is the seller who is entitled to the tax credit. If Form 26QB was filed incorrectly, corrections can be made via the TRACES website.

Richa Patel

Richa Patel (Querist)

15 July 2022 who can claim for TDS deposited at time purchase of immovable property? seller (builder) or buyer? it is seen in buyer's 26as

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

16 July 2022 Seller has to claim such TDS.
It's wrongly filed 26QB correct it.

How to file for Form 26QB Correction?
Login on the TRACES Website as a taxpayer.
Select option “Online Correction” under “26QB” tab to initiate correction request.
Update the details which are required to be revised.
Select the option to verify the request either through Netbanking/ Digital Signature/AO Approval.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

16 July 2022 Builder can claim it. It is also seen in buyer's 26AS, as paid by assessee, which also indicates purchase of property.

Adv. Ravish Bhatt, ADIT, CIOT

Adv. Ravish Bhatt, ADIT, CIOT (Expert)

25 July 2022 You can find provisions relating to TDS in chapter XVII of the Income Tax Act, 1961. There are various sections as well as sub-sections dealing with the subject matter of TDS.

In the present case, the relevant Section is s.194IA, which requires the purchaser to deduct an amount equal to one percent of such amount as an income tax thereon while making payment to resident transferor, whether the builder or any individual.

Whether it’s section 194IA or any other sections pertaining to deduction of tax at source from amongst any sections under Part B of Chapter XVII, the scheme of tax deduction at source generally is that the payer deducts the tax at source and the same will be given as tax credit to payee, who will take such credit into consideration at the time of filing return and calculating the tax liability in the relevant assessment year at the time of filing the return. So, TDS deposited at the time of purchase of immovable property will be claimed by the seller/ payee only i.e. by the builder or an individual seller.

The same may also be seen in 26AS of the buyer as well to reflect/ indicate the purchase of property however amount could be claimed by the seller/ builder only.

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