TDS on Sale of Property by NRI

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This discussion clarifies the TDS rate applicable when a resident purchases property from a Non-Resident Indian (NRI) for over Rs 50 Lakhs. Initially, there was a question about whether 1% or 20% TDS should be deducted. The consensus is that 22.88% TDS under Section 195 applies. While TAN is generally required for TDS deductions, for this specific scenario of NRI property sale, the purchaser can use Form 26QB to deposit the TDS within 30 days of the deduction month, without needing a TAN.

swasti

swasti (Querist)
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15 February 2020 An NRI having a house property in India wishes to sell it to a Resident. The sale price exceeds Rs 50 Lakhs. What TDS has to be deducted by the resident - 1% or 20%? Kindly advise.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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15 February 2020 22.88% TDS under section 195 has to be deducted

swasti

swasti (Querist)
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15 February 2020 Thanks a lot Sir for the expert advise. That means the purchaser has to apply for TAN.

Gokul Sharma

Gokul Sharma (Expert)
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15 February 2020 TDS on immovable property has to be paid using Form 26QB within 30 days from the end of the month in which TDS was deducted
no tan no required.