Tds on purchase of property

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PRIYANKA CHAWDA (Querist)

31 October 2013
what will be the treatment of TDS on purchase of property if the payment is made to the developer on installment basis

CA Pallav Singhania

CA Pallav Singhania (Expert)

31 October 2013 Rate at which TDS shall be deducted :- Tax is deductible at the rate of 1% of the consideration payable to a resident transferor.

If a valid PAN is not provided by the seller, the tax rate would go up to 20%.

Tax shall be deducted at the time of payment or at the time of giving credit to the transferor, whichever is earlier.

If advance payment is being made then TDS would be required to be deducted at the time of advance payment itself. And if installment payment is made, the TDS would be required to be deducted at each such installment.

The tax deducted shall be paid to the credit of Central Government within a period of seven days from the end of the month of deduction.

For Complete details,

https://www.caclubindia.com/forum/tds-on-sale-of-immovable-property-sec-194ia-simplified-268528.asp

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Nikhil Kaushik

Nikhil Kaushik (Expert)

31 October 2013 If the payment is on installment basis, then at each payment, you have to deduct 1%. The same needs to be deposited with government by 7th day of next month.

For eg, if an installment is paid on 31 October 2013 for Rs 100000, then Rs 1000 needs to be deducted and deposited to the govt by 7th Nov 2013.

When you pay next installment, lets say, for Rs 100,000 on 10 November 2013, then you need to deduct Rs 1000 again and deposit the same with govt by 7 December 2013.

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