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Ca certificate required for property being bought from nri

TDS / TCS 810 views 1 replies

Ritesh Khanna

Architect

24 Points Posted on 29 January 2012

Hi,

I am buying a property from a NRI based in UK. I am aware that as per section 195 I am supposed to deduct TDS. I am a resident individual and do not have any TAN number. I have some queries on this:

- I have read somewhere that I can take a declaration certificate from the seller's CA that gives capital gain details from the transaction and also undertakes that the seller would re-invest the same to some other property within stipulated time. Then on the base of this certificate, I dont deduct any TDS. Is this the correct way? If yes, Can somebody share any template for this CA certificate?

- If the above mentioned way is not correct, and I dont want to go the TAN/ TDS way, is there any other way to still go ahead with the purchase of the property legally?

Regards,

Ritesh

Replies (1)

CA. Gopi Vijayaragavan

CA in Service

70 Points Posted on 30 January 2012

Dear Ritesh,

U/s.195, only amount taxable in India alone is subject to TDS. If the income is exempt consequently there will be no TDS.

In your case, if the gain is invested in other property in India, the gain will not be chargeable to tax in india.

However, it is to be taken care of that Virtual certainity must be present that the NRI would purchase another property with in a stipulated time.

If you show the adequate evidence to the chartered accountant that the NRI will buy the new property with in the time permitted, then the CA will give in Form 15CB as it is exempted. Then you can make the payment to NRI without deducting Tax.